Your credit score goes up and down based on facts. The fact that the mortgage was discharged and no payments due since 2011 already should have been on it long ago: in 2011. However, whenever a foreclosure occurs, the date of it WILL appear on your credit score which is NOT yet because there has been none and may never be depending on what happens to the real estate. You do NOT indicate if you are still living on the property so I will assume you don't. As a result, here are your options:
First, you should call the court and see if your case is closed just to make sure even though it is an older case. Until closed the trustee can still sell your house. "Closed" is not the same as "Discharged", so call and ask if closed even though it is 3 years ago, clerks sometimes make mistakes! Now after verification of closure, then since no foreclosure has not yet taken place, then you have the following options:
(1) move back into the place and live there as long as you can for free instead of paying rent or mortgage payments somewhere else;
(2) stay moved out and rent your place until the renters have to finally leave so you have some income (we have seen mortgage companies take years to in fact foreclose so don't assume it will be shortly) ;
(3) stay moved out and leave it vacant (you wont receive any monies or save any though);
(4) stay moved out and let someone you know live there till they have to leave;
(5) see if the bank will pay you for a Deed in Lieu of Foreclosure (maybe they will pay you $2,000 or whatever you agree to) ..try for $3000 first and see what they say (they may not want to accept such a deed if there are underlying mortgages or liens that they can eliminate by conducting a formal sale. The same could be said for a short sale option.
(6) sometimes a person might check out a reverse mortgage as an idea if the facts support such an action but in most bankruptcy cases there is no equity to support such an option but just an idea;
Please remember that if in fact there are any Homeowners Assocation Dues (HOA), that any such HOA due and payable post petition until the property is not in your name are not discharged (only prepetition HOA past due dues are discharged). Technically you could also keep living there until you commit an unlawful detainer and then they can proceed with going through the law to force a formal eviction but in such case you may end up possibly owing fees and costs for unlawful detainer. Most lenders would rather NOT just have property left vacant as it often invites vagrants or persons vandalizing. Good luck and I hope my answer assists you.
If your home mortgage obligation was properly scheduled on your bankruptcy schedules that were filed with your Chapter 7 Bankruptcy Petition, then once your discharge was entered by the court, you no longer had any legal responsibility to pay the mortgage loan. When the property is foreclosed upon in order for the lender to take possession of the property, it is likely that the credit reporting bureaus will make a notation of the foreclosure at that time. This will negatively affect your credit score. Are you still living in the property? If so, make certain that you keep homeowner's insurance in place to protect yourself in case of any damage or liability. I would also speak with my Bankruptcy attorney regarding any post petition liability or exposure you may still have. Good Luck!
Mr. Farnsworth is right, you almost certainly don't owe this debt any more. However, the foreclosure will impact the credit. I'd suggest calling and asking if they will take a Deed in Lieu of Foreclosure, that will save you some credit impact but if you're living in the house you will be out more quickly.
By my answering your question on AVVO I am not acting as your attorney or giving you legal advice. Legal questions are complex and inter-related and before I could act as your attorney I would need a great deal of background information that is outside the scope of this limited inquiry. The advice of competent local counsel is always your best guide through the murky depths of the bankruptcy code.
Here is some info that may be helpful in your situation:
MORTGAGE WAS DISCHARGED: Unless you reaffirmed the mortgage debt in your bankruptcy, the debt was discharged, and you don't owe it any more.
MORTGAGE COMPANY STILL NEEDS TO FORECLOSE: Even though the debt was discharged in your bankruptcy, the mortgage company still need to foreclose. Just filing bankruptcy and discharging the debt does not transfer the title to the home back to the mortgage company. That's what the foreclosure does. And the mortgage company needs to foreclose and take ownership of the home before they can resell it.
FORECLOSURE WILL GO ON YOUR CREDIT REPORT: If and when they foreclose, the foreclosure will go on your credit report and can remain on your credit report for 7 years. (It might be 10 years, but I'm pretty sure it's 7 years.)
COLLECTION AGENCY SHOULD NOT BE CALLING ABOUT THE DEBT: Once you file bankruptcy, nobody is allowed to call you about any debt that was discharged in your bankruptcy. Technically, it is OK for them to contact you about recovering property, but them calling you about the property makes no sense at all to me. If they have not yet foreclosed on the property and they want to do that, then all they need to do is do the foreclosure. They don't need to call you at all for that. In fact, mortgage companies never call and say they're going to foreclose, they just foreclose. Something weird is going on here.
I'LL LOOK IT UP FOR YOU: I'm curious about what's going on. If you like, I can look it up for you. Get me your bankruptcy case number, and I'll check your case to make sure your mortgage was discharged. If you're in Bexar County, I may be able to check the real property records and foreclosure records to see if they have foreclosed yet.
I'll be happy to look into this further for you.
Please message me back with your bankruptcy case number if you would like me to do so or if you have any follow up questions.
If a collection agency is calling, trying to collect a discharged debt, the collection attempt is in violation of the discharge injunction. As such, you should discuss the matter with your attorney. Each state is different. Here in Alabama, a Discharge Injunction violation can be actionable as contempt and result in a damage award for the debtor. Best of luck.
Bankruptcy Chapter 7 bankruptcy Bankruptcy petition Bankruptcy documents Credit score Credit Debt Mortgage lien Debt discharge Bankruptcy and debt Residential property Real estate finances Foreclosure Short sales Real estate and bankruptcy Home mortgage Real estate Homeowners' association Mortgage debt Deed in lieu of foreclosure