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  1. #1

    Default Sale of a Mortgage and Chapter 7 Bankruptcy

    I filed for Chapter 7 BK in 2005 in Illinois and it was discharged 90 days later. I since have moved out of state and walked away from the property. I included my home in that filing and I stayed in the home for a year and a half and made the payments - all the time being told I wasn't responsible since the home had been discharged in my chapter 7 - now the original mortgage holder, AFTER I notified them of my intent to abandon the property - sold my mortgage - they refused to work with me on doing a deed in lieu of foreclosure. So now I am dealing with an attorney back there that states that once the home is sold I will be responsible for anything not paid off by the auction!!!! They keep saying "well, the chapter 7 is discharged" and I keep telling them yes, I know that and that means it was a write off - so what is the deal here ? They tried to tell me that when the mortgage was sold that the new mortgage company wasn't included in the BK and didn't have to honor that ! Isn't the mere fact that the BK was discharged mean that the courts accepted it and all my debts? This is ridiculous that one mortgage company KNOWING that I was abandoning the property - sold it and then it got sold AGAIN ! All the time I had this home in BK after the fact I always got asked by the mortgage company "do you wish to keep the property at this time?" and I usually answered yes until earlier this year when I said nope and they hemmed and hawed and didn't send me any papers to do the deed. I don't care what happens to the property but I didn't think I was responsible for anything once a debt was included in BK ? If that was the case then all my credit cards and my car loan, etc, would be coming after me now too if that rationale was the same as the attorny for the mortgage company is trying to tell me, which I don't believe. I called the original mortgage company when I decided to walk away and it took them 4 months of telling me they would send me the stuff to fill out to do a deed in lieu of foreclosure before they finally told me I needed to list the property, which I could have done easily in the 4 months before I moved. I see from someone elses question that is similar to this that he was answered that a foreclosure cant be reported on a BK included item but the attorneys are telling me that it can be AND that if they sell the home in auction for less than the mortgage they will come after me for the balance. This sounds like a con to get me to pay up but I dont care what they do,

    Any words of affirmation that I am right in my thinking that they cant come after me anymore would be helpful.

  2. #2
    Join Date
    Sep 2005
    Behind a Desk

    Default Re: Illinois BK Chap 7 - now in Arizona

    Was the mortgage sold before or after the bankruptcy was filed? Before the discharge was granted? Was this a "zero assets" bankruptcy? Have you tried to discuss this with the lawyer who represented you in the bankruptcy proceedings?

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