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cfortunato, Attorney
Category: Bankruptcy Law
Satisfied Customers: 8023
Experience:  Bankruptcy professor.
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If someone files Cha[ter 7 bankruptcy and have already gone

Resolved Question:

If someone files Cha[ter 7 bankruptcy and have already gone to their 341A meeting but forgot to add a creditor to Schedule F can they amend their case to include this creditor now? Their 341A meeting was 11/04/11. Can a 2nd mortgage be included in this bankruptcy?

Everything went smoothly with the whole case and there was no discrepancies or changes requested by the trustee.
Submitted: 4 years ago.
Category: Bankruptcy Law
Expert:  cfortunato replied 4 years ago.

Hi JACustomer,

All of your creditors are supposed to be included in your Bankruptcy papers, whether or not you are going to continue to pay them. However, the effect of adding a second mortgage is the mortgage will be discharged - so that you will not longer be legally liable to pay it - but the Bankruptcy cannot remove the second mortgage lien, which can only be done with a Chapter 13.

In any event, you can submit an amended Schedule D (mortgages are Secured Debts) at any time before your case is closed - even if you have already had your trustee meeting.


I think this is what you wanted to know. If not, please let me know.
Thank you!



Customer: replied 4 years ago.
The 2nd mortgage was included in the bankruptcy package but we just weren't sure if there was a way to have it discharged along with the other creditors or not. So what your saying is that even if it is a line of credit we can not include it to be discharged?
Expert:  cfortunato replied 4 years ago.
The loan can be discharged, but not the lien. That means the loan company cannot try to collect the money from you, but if you do not pay, the lien will remain on the house, making it harder to sell.
Customer: replied 4 years ago.
I'm sorry I'm really not trying to be difficult but can you just tell me if the 2nd mortgage is about $80,000.00 and the bankruptcy is amended to include it and it is discharged and the mortgage company debt gets discharged and they still have a lien on the house, how can they collect? Only when the house is being sold, or can they come after the house right away? Will all of that interest stop once it is only a lien and only the amount of the actual balance due now at the time of the bankruptcy is due when the home is sold? Is there any chance they will just forget the debt and discharge the lien too (the mortgage company)?
Expert:  cfortunato replied 4 years ago.

You are not being difficult! You are entitled to clarification of anything you don't understand.

1) What is the current market value of your house?

2) What is the balance on the first mortgage?

Customer: replied 4 years ago.


Current market value of home is about $240,000.00


First Mortgage is about $134,000 right now

Expert:  cfortunato replied 4 years ago.
If your house can be sold for significantly more than the first mortgage - which it can according to the information your provided - and if the second mortgage is not being paid, the second mortgage company can foreclose your house at any time after your Bankruptcy is discharged.
Customer: replied 4 years ago.

But doesn't the first mortgage have to be satisfied before the 2nd mortgage company can try to foreclose on the home? Can they keep the lien indefinately once they are discharged from a bankruptcy?

Expert:  cfortunato replied 4 years ago.
If your house can be sold for $240K, and the balance on your first mortgage is only $134K, the second mortgage company can sell your house, pay off the first mortgage, and keep the balance.
Yes - the lien remains on the house indefinitely, until it is satisfied.
cfortunato and other Bankruptcy Law Specialists are ready to help you
Customer: replied 4 years ago.
Thank y ou so much for your answers, assistance and patience it is really appreciated.