What to do if our 3rd mortgage was discharged in Chapter 7 but the bank that held this loan continues to threaten us with forclosure if we don’t pay them?
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What to do if our 3rd mortgage was discharged in Chapter 7 but the bank that held this loan continues to threaten us with forclosure if we don’t pay them?
Is this legal?
Asked on April 10, 2013 under Bankruptcy Law, North Carolina
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 11 years ago | Contributor
Yes, it is legal. The *debt* may be discharged in bankruptcy, but that does not void the security interest; the lender is entitled to foreclose, unless you and they work something out. What they can't do is sue you personally for the money. "All" they can do is take the property.
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