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I have filled for BK chapter 13 in June 10, 2010. I included

a house in my BK...
I have filled for BK chapter 13 in June 10, 2010. I included a house in my BK that was joint LOAN with my ex wife. The BK was discharged in September, 2015. However, the loan bank still reporting the house loan as a liability on my Equifax credit report as I still owe the money. They said I am still liable for the loan since I did not surrender the house.
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6/1/2017
socrateaser
socrateaser, Attorney
Category: Bankruptcy Law
Satisfied Customers: 39,383
Experience: Attorney and Real Estate Broker -- Retired (mostly)
Verified

Hello,

Under federal bankruptcy law, the only way that you can be "personally" liable for a discharged debt is if you file a "reaffirmation agreement" with the court, which is signed by the creditor and you, during the bankruptcy.

There is a remote possibility that the debt is considered a domestic relations obligation which is not discharged in bankruptcy. However, this would only be true if the debt were determined to be owed to your spouse, rather than to the creditor/lender. Consequently, I don't believe that this exception applies to your circumstances.

Concerning the reason why the loan is still being reported against your credit, in some U.S. jurisdictions, this is sufficient to trigger contempt of court by the creditor, because the act of reporting is interpreted as an attempt to collect a discharged debt. You may want to discuss this with a local bankruptcy lawyer, because you may have a substantial damage claim against the creditor that you can enforce, and get the negative credit report removed from your credit report.

I hope I've answered your question. Please let me know if you require further clarification. And, please provide a positive feedback rating for my answer (click 3, 4 or 5 stars) -- otherwise, Justanswer retains your entire payment, and I receive nothing for my efforts in your behalf.

Thanks again for using Justanswer!

socrateaser
socrateaser, Attorney
Category: Bankruptcy Law
Satisfied Customers: 39,383
Experience: Attorney and Real Estate Broker -- Retired (mostly)
Verified
socrateaser and 87 other Bankruptcy Law Specialists are ready to help you
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Customer reply replied 5 months ago
Thank you for quick response. I have disputed the reporting to Equifax more than three times but each time, Equifax said that they contacted the bank and each time they said that the bank confirmed the information on my credit report and it's accurate as reported by the bank. I have not signed reaffirmation. Attached is a letter I just received from the bank.

The letter you received does not inform me sufficiently about the status of the loan. That said, surrender of the property is irrelevant, because if the debt is discharged, then you don't owe anything, and a report to a credit reporting agency that you remain obligated for the debt is erroneous.

Again, I suggest that you contact a local bankruptcy attorney (I'm in California, so I cannot represent you in the U.S. Bankruptcy Court in Washington) and discuss whether or not you can bring a contempt action against the creditor for contempt of the bankruptcy court discharge order.

Thanks again for using Justanswer!

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Customer reply replied 5 months ago
My ex wife still paying on the house where she resides with her husband. She missed one or two payments so it's also reported the late payment on my credit report.

You are not your ex wife. You have a different credit report, and the creditor's report against you as an individual, in my opinion, is a contempt of the bankruptcy court discharge injunction.

Thanks again for using Justanswer!

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Customer reply replied 5 months ago
Please one more. Can the attorney recover his fees from creditors? If I go through the bankruptcy court.

Yes, but you will have to pay the attorney up front.

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Customer reply replied 5 months ago
I just called a local attorney. He informed me that the bank can still report the loan as a liability on my credit report

Thanks for the update. What legal authority does the attorney cite to in support of his conclusion that the bank can report the liability against you?

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Customer reply replied 5 months ago
I have no idea. He said this is a secured loan. And the loan still exists even if it is discharged
Customer reply replied 5 months ago
Are there any laws that are different in Washington state?

I'm not surprised that the attorney wasn't willing to conduct the required research. Every lawyer is a self-proclaimed expert on everything, and it's really difficult to get a lawyer (who doesn't do research for a living -- like me) to research anything -- because the lawyer can just tell you what he/she thinks is correct, as if it's absolutely true -- and it's hard for you to disagree. Because, if you do, the lawyer will hang up the phone on you!

In my original answer I explained that different bankruptcy court jurisdictions treat this particular issue differently. There are 11 different bankruptcy jurisdictions in the USA. If you want me to research the issue for the 9th Circuit (which includes the Washington Western and Eastern Bankruptcy Court), I can do that. But, we would have to take the issue offline, because, to be frank, it could take an hour or more of my time, and I simply can't afford to devote that much time without receiving additional compensation.

I will send you an offer of direct correspondence -- which you may accept or decline at your discretion. Thanks again for using Justanswer!

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Please follow the instructions in the service offer response. Thanks again for using Justanswer!

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Customer reply replied 5 months ago
I have accepted the offer

Please follow the instructions in the service offer response. Thanks again for using Justanswer!

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socrateaser
socrateaser
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Category: Bankruptcy Law
Satisfied Customers: 39,383
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Experience: Attorney and Real Estate Broker -- Retired (mostly)

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