But aren't I required to do a reaffirmation or redemption plan with them? I have called them dozens of times and the calls take over an hour and leave me cussing. they transfer me 4-6 times and no one can help me. they say no attny has been assigned to my BK and there is no one I can get an address or fax number to try to get a "required?" redemption/reaffirmation plan for either the unrecorded mtg or HELOC. In fact I havent received a statement from the HELOC in over 7 months and when I called them to find the balance prior to filing BK they said the loan had been paid in full. I was on the call for almost 2 hours and then the lady said someone coded it wrong and someone would call me in 24-48 hours. I have called them 22 times since then, asked them to document my calls and was beyond frustrated last week when I found there was nothing documented on my account for the HELOC and they said I don't have to pay them anything until I sell the house. They did recode it though after I told them I never paid it off. It was their error (and maybe mine in informing them I didn't pay it off, but I thought the unrecorded mtg would be unenforceable and I needed the HELOC along with my homestead exemption to keep the Trustee from selling it. I was just about to email trustee to join me in avoiding lien and pursuing litigation, but per your post, I am glad I didn't send that email. I have another question to ask re home in 4 closure. But how would I proceed in state court so they dont try to 4 close after Bk is discharged, being I havent paid the first unsecured since filing BK and the HELOC since 5 months prior? Like I said, there is no contact, they just put me on hold forever, send me to someone else or the beginning as if I just made the call. Wasting hours and hours of my time. I have recorded all calls and have over 200 hours of recordings between all these lenders.
State/Country relating to question: California
But aren't I required to do a reaffirmation or redemption plan with them?
The lender is scared to talk to you because they might technically be violating the automatic stay by negotiating a reaffirmation or redemption with you during your bankruptcy, potentially subjecting them to sanctions. If you want to negotiate with the lender prior to discharge, you would call the bankruptcy attorney for the lender and have an Agreed Order entered simply stating that the lender can communicate with you directly and it won't violate the automatic stay (the court should allow this). Otherwise, you might need to wait until after your discharge for the lender to talk to you.
Florida attorney with extensive experience in Chapter 7 and Chapter 13 consumer bankruptcy cases
"they say no attny has been assigned to my BK"
If that's true, that's unusual... when I represented mortgage lenders, they would typically have us monitor HELOCs even if we weren't going to file a Proof of Claim (in case Debtor filed a Motion to Value or something similar).
"I was on the call for almost 2 hours and then the lady said someone coded it wrong and someone would call me in 24-48 hours. I have called them 22 times since then, asked them to document my calls and was beyond frustrated last week when I found there was nothing documented on my account for the HELOC and they said I don't have to pay them anything until I sell the house. They did recode it though after I told them I never paid it off."
The loan was probably coded internally as "charged off," which is a term that probably confuses a lot of bank employees pulling up your info on the computer (as most borrowers in default try to avoid contact with the bank instead of actually trying to contact them). This doesn't actually mean that the loan was written off but simply that the mortgage debt is unlikely to be collected from the borrower. The debt is still legally valid, but it's coded this way in order for the bank to get a corporate tax break.
Once they get a tax break they can't foreclose can they? Legally? Isn't that double dipping? Credit report says charged off, so now what would the future hold post bk discharge?
Once they get a tax break they can't foreclose can they?
Yes, they can still foreclose once your bankruptcy is discharged. I'm not a tax expert (a tax expert could probably clarify or correct this), but basically I think the bank just doesn't have to pay taxes on the interest income that they didn't actually receive from you, plus potential carryover losses and such (which I don't totally understand, to be honest - you should ask an accountant or tax expert if you are interested in more detail about this).
Credit report says charged off, so now what would the future hold post bk discharge?
While a charge-off is considered to be "written off as uncollectable" by the bank, the debt is still legally valid, and remains as such until your discharge. After that time, the debt is "charged off" (or more accurately, discharged) as to your personal liability... but the bank can still foreclose on its lien on the property.
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