Legal Question in Bankruptcy in Oklahoma

I filed for Chapter 7 bankruptcy 3 years ago. I had rental properties that were surrendered in the bankruptcy. I recently applied for a new home mortgage, and learned that two of the lenders who held mortgages filed foreclosure judgments after the bankruptcy, and those foreclosures on my credit report are now preventing me from obtaining a mortgage. If the debts were discharged in a bankruptcy, can they still file a foreclosure judgment afterward? Thank you!


Asked on 9/23/11, 2:07 pm

1 Answer from Attorneys
James Matthew Branum James M. Branum, Attorney at Law

Yes, they can get a foreclosure judgment after the automatic stay is lifted.

Or to say it another way, based on what you've told me, bankruptcy discharged your personal obligations (the "in personam" debt) to pay the debt on those rental properties. But bankruptcy does not erase the debt tied to the property (the "in rem" part of the debt), which means that the lender was able to sue to take back the property in a foreclosure action. It is certainly possible that you executed a deed in lieu of foreclosure though at the time of your bankruptcy, but I'm not sure if this would have any practical effect on your credit report or not.

Sorry the news is bad, but hopefully the information will be useful.

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Answered on 9/23/11, 2:49 pm


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