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LawGuy, Attorney
Category: Bankruptcy Law
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Experience:  Over 25 years experience representing clients in business, transactional and real estate law.
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Can a creditor file a 1099c and still hold a title lien on

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can a creditor file a 1099c and still hold a title lien on my house?
JA: What state are you in? And are you working with a local attorney?
Customer: NC
JA: Has anything been filed in civil court? If so, what?
Customer: no
JA: Anything else you want the lawyer to know before I connect you?
Customer: no

Thank you for using JA. I am Loren, a licensed attorney for over 30 yrs., and I am here to help.

I am a certified expert on JustAnswer since 2009, with nearly 100% in 5 star ratings. So, we should be able to work through your problem.

This is general information and no attorney client relationship is established.

Unfortunately, the note and the lien are two different things. So, the lender can forgive the repayment and still retain the mortgage lien on the property.

A release of lien occurs when the debt has been satisfied. The lien is the "in rem" (meaning "against the property") liability. The lender does not have to release that, regardless of debt forgiveness or discharge, without payment in full.

That said, there are various options for negotiating a release of lien short of full satisfaction.

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Customer: replied 8 days ago.
what are some of the options for negotiating a release of lien short of full satisfaction

You have a couple of options.

First, you can try to sell the property and work out a short sale. That is where the property would sell for less than is owed and the lender would agree to release the note and mortgage in return for the net proceeds of the sale.

Next is a deed in lieu of foreclosure. That is a negotiated agreement where you voluntarily deed the property to the lender without the lender having to go through the foreclosure process. As part of the negotiation, the lender would release the note and mortgage. You might also be able to get them to stipulate that the value of the property is the remaining balance of the mortgage.