I am getting letters from chase offering me to settle on a $100,000.00 debt for a lower price. The thing is my wife went bankrupt and the debt was discharged. They still have a lien on the house. What can I do to have the lien removed, there is no debt owed.
Bankruptcy discharges the money you owe. But if you don't pay, they get to keep the lien on your house and eventually foreclose on it to recover their money. Your OBLIGATION TO PAY out of pocket is removed - but not the lien on the house, from which they can take the money you owe. There IS debt owed - not by you personally any more, but by the property itself. That's what a lien is.
This should not be considered legal advice and is intended for educational purposes only. It does not constitute a contract for legal services between any parties. Answers are given to questions for which there may be additional facts not mentioned which might change the legal issues or consequences.
There are two kinds of liability for a debt for which a judgment or some other kind of lien exists. There is the debt the person owes him or her self personally. There is also the lien. Liens are a debt that is attached to a property. When someone files bankruptcy the personal liability of the debtor is discharged. However the lien on the property remains unchanged and can be enforced/collected at the time the property is sold or can be enforced by the creditor foreclosing on the lien.
You haven't said what kind of lien Chase has. That matters. If it is a voluntary lien such as a mortgage it cannot be stripped off in a ch7 but mightbe able to be stripped in a ch13 but only if it is a second (or junior) mortgage that is wholly unsecured (meaning that the value of the house is less than the amount owed on the first mortgage). If the is ANY equity, the secondor later mortgage cannot be stripped.
If the lien is a judgment or judicial lien, then it can be avoided to the extent it impairs the debtor's ability to claim an allowed exemption under applicable state law.
You'd need to reopen the bankruptcy and file an adversary proceeding to strip the second mortgage or reopen the bankruptcy and file a motion to avoid the judicial lien. You will need an attorney to assist you.
DISCLAIMER: This message is intended as a general discussion of legal issues and not as a statement of fact, legal advice or a legal opinion. No attorney-client relationship is created by this message. Do not act or rely upon law-related information in this communication without seeking the advice of an attorney licensed to practice in the relevant area. I am a Federally Designated Debt Relief Agency under the United States Bankruptcy Code. I proudly help people in financial need file bankruptcy cases. IRS CIRCULAR 230 NOTICE: To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. tax advice contained in this communication (or in any attachment) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed in this communication (or in any attachment).
The first thing that has to be understood is that a discharge releases a person from personal liability. If there is a valid lien against land, the lien remains absent some other action. If only your wife filed and you are on the note, then you remain personally liable on the debt. You need to have your case fully reviewed for more definitive answers
I'll pile on, and add: If the chase debt is a voluntary lien (ie: a Deed of Trust) the lien will remain on the house until you either sell the house (and the lien is paid from the sale); they foreclose on their lien; or you reach a settlement with them. If the lien is a judgment lien and it impaired your exemption in the house when filed, the lien might have been avoidable. You should go back to the attorney who helped you with the bankruptcy to reopen the case and avoid the lien if that is the case.
Finally, if the lien is a junior lien on the property, and the value of the house is less than the total of the liens, it may be possible to strip the lien or reduce it through a chapter 13. Which you could do is dependent on the type of lien and value of the property.
This response is not intended as legal advice. You may need to consult your own attorney to obtain a more specific answer.
Without knowing anything more about this except the amount of the debt, the name of the creditor and that they are trying to settle this claim, I would guess that this is a mortgage obligation, a "Deed of Trust". If so, that is a "voluntary lien" and cannot be avoided (or removed). The lien that might be against real property that is avoidable is a judgment lien. That's it. If it is not based on a judgment, but is a voluntary lien, a statory lien, a tax lien, etc., it cannot be avoided.
Hopefully you had an attorney in your bankruptcy case. If so, seek their advice in getting a more complete explanation and to make sure this is not something that can be avoided. Avoiding a judgment lien can be simple or it can be very complex. But like I said, I'm guessing this is a mortgage and the property will remain liable for it. If it is not paid or settled, the creditor can foreclose at any time after the bankruptcy is closed, unless you are current in payments.
One final thought, you put this in Chapter 13 bankruptcy. If this was a junior mortgage lien and the lien was "stripped" in a chapter 13 bankruptcy case, with all of the proper documents, motions and orders, that creditor may be in violation of the bankruptcy discharge. You need to talk to your chapter 13 attorney about that.
Disclaimer: This answer does not constitute legal advice. I am admitted to practice in the State of California and the Federal District Courts in the Eastern, Northern, Central and Southern Districts of California only. My experience is in those jurisdictions only. This advice is based on general principles of law that may or may not relate to your specific situation. Facts and laws change and these possible changes will affect the advice provided here. In reading any advice or opinion given you agree that I do not have all or the facts so that any statement here may not be complete or fully accurate. You must consult an attorney in your locale and make sure that they are fully informed of your situation and the facts of your case before you act on any of this advice. You should not rely on this advice alone and nothing in these communications creates an attorney-client relationship.
Our Rating is calculated using information the lawyer has included on their profile in addition to the information we collect from state bar associations and other organizations that license legal professionals. Attorneys who claim their profiles and provide Avvo with more information tend to have a higher rating than those who do not.What determines Avvo Rating?Experience & background
Years licensed, work experience, educationLegal community recognition
Peer endorsements, associations, awardsLegal thought leadership
Publications, speaking engagementsDiscipline