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  1. #1
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    Default Filed for Bankruptcy, but Can't Remove Lien from Real Estate

    My question involves real estate located in the State of: PA

    I purchased a home in 2006. I was unable to pay the mortgage and in 2008 I filed for bankruptcy. The bankruptcy discharged my debts, including my mortgage. The original mortgage lender (or backer) was Freddie Mac. Since 2008, Freddie Mac has neither requested to foreclose the home, nor has it released the lien to me. Thus, the deed of the house is still under my name as the house was never foreclosed. And now, many years after the bankruptcy, I am still being forced to pay for property taxes, etc., including having an impaired credit score to this day.

    I continue to contact Freddie Mac to either (1) foreclose and take over the deed, or (2) to release the lien to me so I can sell the property and be over with all this headache. However, my attempts have been unsuccessful as Freddie Mac is very hard to get in touch with, and I cannot legally force them to do either of the only options noted above.

    How can I force Freddie Mac to release the lien to me? Else, what are my options to getting out from my name being on the deed of the property?

  2. #2
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    Default Re: Filed for Bankruptcy, but Can't Remove Lien from Real Estate

    They have no obligation to release the lien. The house was a guarantee you would pay and if you defaulted or declared bankruptcy, they would maintain their interest.

  3. #3
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    Default Re: Filed for Bankruptcy, but Can't Remove Lien from Real Estate

    Don't listen to the neigh sayer disagreeable. You can force Freddie Mac to release the lien.


    All you have to do is pay the amount of money the bank will accept to release the lien. If you give them that amount of money and they refuse to release the lien, you can successfully sue them and get a court to order they release the lien.

  4. #4
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    Default Re: Filed for Bankruptcy, but Can't Remove Lien from Real Estate

    Quote Quoting jk
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    Don't listen to the neigh sayer disagreeable.
    Does disagreeable have a cold, because you seem to think he's a little hoarse.... er, horse?
    Quote Quoting Ed Dantes
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    And now, many years after the bankruptcy, I am still being forced to pay for property taxes, etc., including having an impaired credit score to this day.
    The bankruptcy would be impairing your credit score, but what is currently happening that is affecting your credit score?

    Many people in your position continue to live in the house, paying no mortgage, and find that outcome to be acceptable. I've seen cases in which the lender picks up the property taxes in order to avoid losing the home to a tax foreclosure, even though they're not exercising their right to reclaim the property.... If you stop paying the taxes and the lender does not start paying them, at some point in time in the future the property will be sold in a tax foreclosure.

  5. #5
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    Default Re: Filed for Bankruptcy, but Can't Remove Lien from Real Estate

    Thanks JK.

    Freddie Mac told me the same thing, in that they will give me the lien if I work out a plan to pay them something. They are now internally deciding for what amount they will release the lien to me, and then they will send me a letter. My issue is, what if this amount is very big, say, $10,000. I don't want to pay anything, because I don't have the money. If the amount they are seeking is, say, $500, then sure I can pay that much. But my feeling is that they will try to bribe me and sell me the lien for a large amount. After all, they lost the money they lent to me when they financed the house.

    Is it legal for Freddie Mac to force me to pay a large amount for the lien? Because if I don't have the money to buy the lien from them, I continue to incur property taxes, and this is just killing me financially. The reason I bankrupted is because I could not pay the mortgage, and now it seems like a sort of bribe on Freddie Mac's part, doesn't it?

  6. #6
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    Default Re: Filed for Bankruptcy, but Can't Remove Lien from Real Estate

    They can require you to pay the entire amount discharged in the bk for them to release the lien.

    i see nothing wrong with Freddie Mac requiring they be paid what you borrowed so as to release the lien. Whether it be from you or somebody else they have a right to their money.

  7. #7
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    Default Re: Filed for Bankruptcy, but Can't Remove Lien from Real Estate

    Mr. Knowitall,

    Well, the bankruptcy impaired my credit score, but since I filed in 2008, in another 2 years, the bankruptcy will fall off my record. The issue is that the deed of the property is under my name. The only way the deed could go away is if 1) Freddie Mac (FM) takes over the deed via foreclosure, and 2) they release the lien to me, and I sell or donate the house (i basically want to rid myself of this property and headache). Now I know I cannot force FM to foreclose....i do not have that legal authority. And FM refuses to foreclose or release the lien to me. So I am stuck and don't know what to do.

    I do not live in the property anymore. The property was an investment property. I bought it in 2006 to rent it out to tenants. Obviously I made a bad decision because I overpaid and went under on the mortgage. So I filed for bankruptcy two years after buying the property, namely in 2008. I never lived in the property before or after buying it. Again, it was for renting purposes only, sort of an investment property.

    Furthermore, the property has little to no value anymore, so much so that FM does not want to foreclose and sell on their own to recoup any part of their losses. If they foreclose, they take over the deed and become responsible for property taxes and all other related costs, and the asset is worthless. So they choose not to foreclose, which I do not blame them for. But they are also refusing to release the lien. If I had the lien, then I could get rid of the property by selling it to someone for $1 or just donate it to a charity or something. But without the lien, I am stuck.

    - - - Updated - - -

    But what's the point of having filed for bankruptcy. When the court discharged the debt I owe to Freddie Mac, does not that make it illegal for Freddie Mac to force me to pay, again? Something seems amiss here. But thanks for your contribution. I guess I have to get a lawyer to sort this out.

  8. #8
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    Default Re: Filed for Bankruptcy, but Can't Remove Lien from Real Estate

    You don't owe the debt and your bankruptcy does not cause the lien to be released so you are where you are; Freddie got screwed but he still has a right to receive payment from somebody to release the lien. They aren't demanding you pay them due to the loan you defaulted on. They are demanding you pay them to release the lien.

  9. #9
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    Default Re: Filed for Bankruptcy, but Can't Remove Lien from Real Estate

    Quote Quoting Ed Dantes
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    But what's the point of having filed for bankruptcy. When the court discharged the debt I owe to Freddie Mac, does not that make it illegal for Freddie Mac to force me to pay, again? Something seems amiss here. But thanks for your contribution. I guess I have to get a lawyer to sort this out.
    Actually, Freddie Mac is not "demanding" that you pay them anything.

    You are "demanding" that they release the lien and they are passively saying "OK, pay us and we'll do it, don't pay us and we won't. We don't care one way or the other."

    See, the difference is that Freddie Mac is not pursuing you for payment. That would be in violation of the bankruptcy code.

    You are pursuing Freddie Mac to do something that you want that they have absolutely no obligation to do. So if you want it bad enough you pay what they say you pay. Get the difference?

    By the way, nobody is "forcing" you to pay the taxes. You can stop paying and let the property go for a tax sale. That's one way to get rid of it.

  10. #10
    Join Date
    Nov 2013
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    Default Re: Filed for Bankruptcy, but Can't Remove Lien from Real Estate

    "When the court discharged the debt I owe to Freddie Mac, does not that make it illegal for Freddie Mac to force me to pay, again?"

    You didn't "pay" it in the first place. You got out of paying your legal debt. Why would they want to give up the only chance they have of recouping at least some of their loss? The loss that you caused by refusing to pay the debt you incurred.

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