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  1. #1
    Join Date
    Dec 2017
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    1

    Default Requesting a Validation of Debt After a Chapter 7 Bankruptcy

    My question involves collection proceedings in the State of: Illinois
    I requested a validation of debt from my mortgage company. This is the 3rd time my mortgage was sold since 2011( which is my loan servicer now) I recently filed a chapter 7 in 2015 and kept house. I requested a validation of debt from this 3rd party mortgage company 3 months ago and they have failed to send it. No proof or documentation that they have the right to collect any money from me. I’ve sent 3 letters. My question is, by me being under an automatic stay from the Chapter 7, does that mean i have no rights to request a validation of debt? If i was to stop sending payments to loan company now, will they try to foreclosure on my home because of this automatic stay?

  2. #2
    Join Date
    Oct 2014
    Posts
    8,238

    Default Re: Requesting a Validation of Debt 2yrs After a Chapter 7

    Quote Quoting Ethereal
    View Post
    My question involves collection proceedings in the State of: Illinois
    I requested a validation of debt from my mortgage company. This is the 3rd time my mortgage was sold since 2011( which is my loan servicer now) I recently filed a chapter 7 in 2015 and kept house. I requested a validation of debt from this 3rd party mortgage company 3 months ago and they have failed to send it. No proof or documentation that they have the right to collect any money from me. I’ve sent 3 letters. My question is, by me being under an automatic stay from the Chapter 7, does that mean i have no rights to request a validation of debt? If i was to stop sending payments to loan company now, will they try to foreclosure on my home because of this automatic stay?
    If you filed bankruptcy in 2015 in a Chapter 7 usually that would be completed by now. If, however, the bankruptcy case is not complete and the automatic stay is still in effect, the lender likely is not going to send you anything to verify the debt as that might be construed as an attempt to collect the debt in violation of the automatic stay. The bankruptcy law does not prohibit you from asking for verification, but no law requires the creditor or collector to provide that verification upon demand either. What the federal Fair Debt Collection Practices Act (FDCPA) says is that if you ask for verification from a debt collector and the debt collector does not provide it the creditor is prohibited from attempting to collect the debt (other than filing a lawsuit) until that verification is provided. But since the collector cannot collect from you anyway while the automatic stay is in effect, there is no incentive for the creditor to give you the verification. And as it might raise a risk that you'd claim the verification letter was an effort to collect the debt in violation of the stay, the safer thing for the collector to do is just not respond. If you stop making payments the creditor may ask the bankruptcy court for relief from the automatic stay so that it may foreclose. If granted, then the creditor is free to pursue the foreclosure.

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