Legal Question in Bankruptcy in California

Vengefull Lender

We filed bankruptcy in April and recieved discharge in July we included our two homes one that we refi'd in October 06. We vacated both homes and one is set for foreclosure sale Dec 26. Can the lender come back at us if the property doesnt sell or sells for less than the loan amount. Real estate has taken a huge hit in our area and my income is next to nothing since spring of 07. We are concerned that the lender might try to persue us at a later date or does our discharge resolve that automatically?


Asked on 12/19/07, 5:10 pm

2 Answers from Attorneys
Carl Starrett Law Offices of Carl H. Starrett II

Re: Vengefull Lender

Your obligation to repay the debt was discharged. The lender's only remedy is to foreclosure. And because the debt was discharged in bankruptcy, you will not have any debt forgiveness income when you do your 2007 taxes. Any attempts by the lender to collect or otherwise hold you accountable for the loan or any deficiency.

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Answered on 12/19/07, 5:31 pm
Allen Farshi Law Offices of Allen Farshi

Re: Vengefull Lender

Assuming your property mortgage is unsecured, to the extent of a deficiency, your attorney should have indicated that portion as a contingent liability which should be discharged in bankruptcy. Otherwise the lender must act within 60 days or waives the right to pursue a deficiency. Note a deficiency is recoverable only on junior non purchase money loan.

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Answered on 12/22/07, 4:14 pm


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