The Bank Can’t Find My Mortgage After My Bankruptcy. – Bernice

“Dear Steve,

I have filed for Chapter 7 Bankruptcy in 2012 and was discharged from all unsecured debt in June of that year. I have been paying all secured debt which includes a mortgage, a line of equity (no longer useable), and a car note as well as my utilties, insurance payments, etc. All of those bills have been paid in a timely manner.

My question is this, I have another debt which is listed as a 3rd mortgage. I had 1/2 of my basement finished for $14,000.00 and I was paying a monthly payment on that of $141.84. When the bankruptcy was discharged I stopped receiving statements in the mail and I was banned from paying the debt on-line.

I was told that I had to speak with the bankruptcy attorneys of the bank. I called them and advised that I am trying to pay this secured debt as I do not want my house to be foreclosed on since this is technically listed as a 3rd mortgage.

The woman I spoke with practically laughed in my face and said they would never foreclose on my house as this is now considered a bad debt and has been charged off.

I will no longer receive statements and any payments I do make are completely voluntary. i cannot pay them over the phone as there would be a charge assessed and I would have to send them to a banckruptcy address to be recorded there but without any statements. I have asked my lawyer about this and she could not tell me not to pay in good conscience unless I get something in writing which I do not think the bank is willing to do.

My question is, do I make the payments on this ‘loan’ even if i am being told that they are all voluntary or do I keep that money and put it into a credit union account as a means of saving after bankruptcy?

I do not want my house to be in jeopardy but I find it hard to belive that I would have to pay something that the bank itself is telling me will not even be acknowledged. When I did call the bank they had no case number for me and could not even find the actual account/loan number.

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Do you have any suggestions? I am willing to pay the monthly fee but knowing that it is voluntary and they will never charge me late fees or send out statements, or report me, or foreclose on my house (representative’s words) makes me not want to pay it at all. Any insight would be greatly apprec iated. Thanks.


Dear Bernice,

Well you are caught in the middle on this one.

The problem is that the bankruptcy discharged your liability for the debt but if the debt was secured with a lien against the property, that lien most likely still exists and will have to be satisfied if you ever sell the property.

You can make all the payments you want but unless you get some accounting or assurance from the bank your payments are being applied to that account, well then cross your fingers and hope it works out.

The same issues exist for your other debts against the house you continue to pay.

At this point I don’t have enough information to even know if the basement loan was even recorded as a lien against your property. The least expensive way to find out would be for you to go to the court house where your local property records are kept and ask them to help you find the mystery lien.

If it is not a lien against the house then it was an unsecured loan and discharge in your bankruptcy.

Do some homework and then come back with an update.

Please post your responses and follow-up messages to me on this in the comments section below.


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