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Ellen, Attorney
Category: Bankruptcy Law
Satisfied Customers: 36714
Experience:  Bankruptcy Lawyer. Experienced.
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3.5 years ago my wife and I filed for Chapt 7 bankruptcy due

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3.5 years ago my wife and I filed for Chapt 7 bankruptcy due to a failed LLC. In that filing application we released (discharged) all debts and several assets but specifically reaffirmed our primary residence. However, the filing BK attorney's office (or someone along the way) errantly included our primary residence as also discharged when the BK was filed.
It took us many months to discover the error -- and with current major loan servicer backlogs they still have not retaken possession of the property, which means the title remains in our name. The result is that we still cannot qualify for a new mortgage for a different home... and experience significant other credit challenges as a result of someone else's error.
Our question is: might we have any legal recourse on whoever made the BK filing mistake?
*This chat is not intended as legal advice. It is general information that may or may not apply to your situation and should not be relied upon.*


Thank you for your question. My name is XXXXX XXXXX I will do whatever I can to answer your questions!

To clarify, it was your intention to reaffirm the mortgage on your primary residence but that mortgage was not reaffirmed in the filing?

It sounds as if the property is now in foreclosure. How does the foreclosure relate to the failure to reaffirm?
Customer: replied 3 years ago.

Correct: wanted to retain the property and reaffirm the debt.


During the few months it took to complete the filing, the BK attorney said to stop all payment of any kind to anyone. We did so for about three months before feeling it was time for us to resume with the mortgage servicer.


By that time there were some late fees to cure the loan. We learned of some options to modify the loan as a means to take care of those fees and ensure the loan was comfortable moving forward.


We started the loan modification application process while resuming loan payments -- but those payments quickly started coming back to us as unaccepted. Chats with the loan servicer call center told us that payments would not be accepted while in loan modification application mode. Turns out that was wrong; the bank had already put the property into foreclosure status (which we would not learn for some years to come).


By that time the fees had become too large for us to cure the loan out of pocket, so had no choice but to continue to pursue the modification possibility to save the house.


3.5 years and 12 loan modification re-attempts (Chase Bank times out on documentation, can't seem to get to a final answer on it) later, we finally decide to attempt to secure a new loan from a different bank to 'buy-out' the current servicer and start fresh with the same home. It was then that we learned that the debt on the home was discharged (account shows as close don credit reports and banks cannot refinance a non-existent loan). Further digging had us also then discover our real situation of debt discharged but title still in our name...

Thank you for the explanation.

Your attorney may have committed malpractice by instructing you not to pay the mortgage on your home for the three-month period. However, the statute of limitation would prevent you from filing suit to collect on that basis.

The statute of limitations is a law that restricts the period of time that an action may be enforced by the court. If the time has expired, we say that the statute of limitations has run and action is time-barred by the statute of limitations.

Or. Rev. Stat. § 12.110(1) requires that a malpractice action be filed within 2 years of the occurrence or it is time-barred

Therefor in your situation, it appears that the statute of limitations has run and action is time-barred by the statute of limitations

I would be glad to respond to any follow-up questions that you may have.
Ellen and 3 other Bankruptcy Law Specialists are ready to help you
Hi Kevin,

I have been thinking about your situation. There is a possibility that a Chapter 13 bankruptcy could force the reinstatement of the mortgage or a modification of the mortgage.

If would like to discuss alternative options and/or the effect of the current situation on your credit, you can directly route a new question to me by using this link ::

Still put "For FiveStarLaw" at the beginning of the question.

Best regards,

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