When you say the house was "auctioned off" are you saying that you surrendered it to the mortgage lender through the Chapter 13 bankruptcy or did you simply walk away from it?
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Before you lose any more sleep over the letter from the mortgage company you should contact the attorney that handled your Chapter 13. If you surrendered your interest in the Chapter 13 Plan then you debt to the mortgage company was discharged during the bankruptcy. If it was discharged then the mortgage company is violating your discharge.
Next, if the mortgage was not discharged for some reason, which I think is unlikely, your ability to file a Chapter 7 depends on what percentage of unsecured debt you paid during your Chapter 13 plan.
In both cases you need to go back to your Chapter 13 attorney to get some clarification. The likelihood is that the debt was discharged and the attorney will confirm this. Hope this helps.
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I agree that the house was likely included in your Chapter 13 bankruptcy. The mortgage company may just need notice of this previous filing and discharge. Your previous bankruptcy attorney will be able to provide this for you.
Your house may not have been properly surrendered in the 13. Your case can be reopened but must be done properly. Either your attorney should have arranged to have it quick claimed to the lender or he/she would have filed a motion forcing the lender to accept a quit claim deed. Regardless, I am sure a good foreclosure attorney can challenge the new lender.