Mortgage and Foreclosure

Chapter 7 Discharge Does Not Prevent Subsequent Foreclosure

01/24/14

A reader wrote me stating that she had filed Chapter 7 bankruptcy because a bank was suing her for the amount of her home mortgage. This was not a deficiency action. The bank sued the reader for default under the promissory note without foreclosing on the mortgage. Without foreclosure, the owner would keep her house but the bank would have a judgment against her personally. She filed Chapter 7 to stop the lawsuit.

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Chapter 7 Discharge Does Not Prevent Subsequent Foreclosure

01/24/14

A reader wrote me stating that she had filed Chapter 7 bankruptcy because a bank was suing her for the amount of her home mortgage. This was not a deficiency action. The bank sued the reader for default under the promissory note without foreclosing on the mortgage. Without foreclosure, the owner would keep her house but the bank would have a judgment against her personally. She filed Chapter 7 to stop the lawsuit.

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Defend Foreclosure Lawsuits Before Considering Bankruptcy

05/22/13

Many people file Chapter 13 bankruptcy to stop a foreclosure, and some people file Chapter 7 bankruptcy to discharge mortgage deficiency liability. I think many people are filing bankruptcy prematurely, and unnecessarily, to deal with foreclosure.

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Does Chapter 13 Bankruptcy Preclude Mortgagee Filing Unsecured Deficiency Claims?

05/15/13

A potential bankruptcy client wanted to avoid a deficiency judgment from a partially first mortgage on his home. The client’s income made him ineligible to file Chapter 7 bankruptcy which would have discharged the deficiency liability in full. The client had heard that filing Chapter 13 bankruptcy could also eliminate the deficiency claim completely.

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Chapter 7 Second Mortgage Stripping Is Alive and Well

10/29/12

Bankruptcy people have been getting nervous about debtors stripping second mortgages from their homestead properties in Chapter 7 bankruptcy.

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Mortgage Lenders Paying Homeowners To Find Short-Sale Buyers

02/24/12

Are mortgage lenders finally “getting it?” Since the beginning of the housing crash so many homeowners have expressed to me their frustration trying to work with their mortgage company to arrange a reasonable short sale of their real estate. These homeowners could not comprehend why the mortgage lender believed it was in their interest to foreclose on a property and then own the real estate instead of working through a short sale to dispose of the property to a ready and willing buyer. 

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Foreclosure and Stay Relief Denied When Mortgage Lender Cannot Demonstrate Proper Assignment of Mortgage Instruments

10/17/11

As most know, during the years leading up to the real estate crisis mortgage lenders originated individual home loans and then assigned packages of these loans to investors who converted the packages to mortgage securities. The assignment process involved an intermediary organization called Mortgage electronic Registration System, Inc. (“MERS”) which held millions of mortgages as an agent of the original lender and essentially served as a mortgage storage bin to facilitate mortgage transfers during the securitization process.

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Chapter 13 Mortgage Mediation Seminar Reports Program Success

09/19/11

Last month I attended a seminar about mortgage modifications in Chapter 13 bankruptcy. There were several points that warrant a series of blog posts.

One speaker compared mortgage mediation in the context of a Chapter 13 bankruptcy with mortgage mediation in a state court foreclosure. He explained why the homeowner usually has a better chance to save his home by filing Chapter 13 and requesting mortgage mediation.

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Another Court Says Reaffirm Personal Liability On Mortgage Or Face Foreclosure

09/15/11

Another bankruptcy court decision on reaffirmation of mortgage loans. Bankruptcy debtors have always understood that they had to reaffirm their liability for car loans if they wanted to keep the car through bankruptcy. Many debtors over the years believed they did not have to reaffirm secured loans such as home mortgages. A Middle District bankruptcy court ruled a couple years ago that a mortgage lender could demand the homeowner reaffirm personal liability on mortgage debt.

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Mortgage Mediation In Chapter 13 Bankruptcy Sabotaged By Lender Document Requests

08/06/11

Have you been jerked around by mortgage banks in court ordered mortgage mediation in Chapter 13 bankruptcy cases? Another local attorney spoke with me this week about how big banks are playing debtors and their attorneys in court ordered mortgage modification mediation.

The attorney’s client filed Chapter 13 in Orlando where the courts have for some time ordered mortgage lenders to participate in mediation regarding modification of Chapter 13 debtor’s home mortgages.

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