How do I change the verbiage stating my mortgage was included in Chapter 7 when it wasn't included? 15 Answers as of October 25, 2013

My question is about a reaffirmation of a mortgage after discharge. I filed for chapter 7 bankruptcy two years ago and decided to keep the house but did not sign a reaffirmation letter since I was advised not to. Even though I have paid my monthly payments on time, in my credit report, the bank has a negative mark that affects my score and status of my credit. What can I do to change that and remove the verbiage that states my mortgage was included in chapter 7, which it was not.

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Tokarska Law Center
Tokarska Law Center | Kathryn U. Tokarska
All debts must be listed in the bankruptcy petition, so it's not correct, although not uncommon for people who filed a bankruptcy, to say that the debt was not "included" in the bankruptcy unless their attorney has explained a few things about how this works. There is a difference in what happens with secured debts (like mortgages) versus unsecured debts (like credit cards) in bankruptcy. Credit cards are unsecured so there is no collateral and when the debt is discharged that takes care of that debt. On secured debts, understand that only your personal obligation to pay on the note has been discharged, assuming of course the case received a discharge. Unless it was possible to extinguish the security interest (through something called lien avoidance or lien stripping, which is only possible in some limited situations) the creditor's security interest in the property survived the bankruptcy. What does this mean? It means that the creditor cannot succeed in suing you to collect payments or a deficiency that may result post foreclosure, but the creditor continues to have the right to take the property through a foreclosure process if payments aren't made voluntarily. I think what your concern is that your continued timely mortgage payments are not reflected in the credit report. This is a common issue on mortgage loans where reaffirmation did not take place. Most attorneys agree that reaffirming a mortgage is not in the best interest of the client so they advise clients not to do it. If there was no reaffirmation the creditor will not report payments to the credit bureaus because doing so could be misconstrued as attempts to collect a discharged debt. The up side of the fact that no payments are being reported is that if you are late on payments or stop making payments this negative information is also not being reported on the credit report. There is something you can do. Once a year request a statement from the lender showing the payments that have been made. Keep a copy of this in case you need it like for example to prove to a new potential lender when attempting to refinance that the payments have been made. Instruct the credit bureaus to add the payment schedule to the credit report so that anyone who pulls the credit can see that payments are being made. Caveat: Answers to questions online cannot replace actual legal advice or being represented by a lawyer in your case. There may be other undisclosed facts that could impact your results. A legal consultation with an attorney would involve disclosing quite a few other things about your financial activities and situation. Hope this helps.
Answer Applies to: California
Replied: 10/25/2013
A Fresh Start
A Fresh Start | Dorothy G Bunce
You can't change and credit report but you can do an end run around it by regularly asking your mortgage company to provide you with an updated account history showing that you have made timely payments. Many creditors will accept that information as proof instead of relying on your credit report.
Answer Applies to: Nevada
Replied: 10/24/2013
Niketas & Clark, LLP
Niketas & Clark, LLP | Alexia K. Niketas
You can't do anything about that, as far as I know - that note on your credit simply means that you are no longer personally liable for the mortgage loan (your PERSONAL liability was discharged in your Chapter 7 which is the purpose of Chapter 7). The lien remains on the property (since it is a secured debt). As long as you continue to pay the mortgage, you can keep your home. We rarely (if ever) advise clients to sign reaffirmation agreements because it defeats the purpose of the Chapter 7 discharge - you would have taken on personal liability again if you had reaffirmed and then you risk being sued on that debt should something happen down the road and you default on the mortgage. Technically, since this is no longer your personal debt, the lender can't report positive OR negative activity on your account to your credit bureaus. They can only foreclose on the property if you stop paying the mortgage.
Answer Applies to: Georgia
Replied: 10/24/2013
Goldsmith & Guymon
Goldsmith & Guymon | Marjorie Guymon
You can write the credit bureaus and ask they make a notation on the your report stating you are current.
Answer Applies to: Nevada
Replied: 10/24/2013
Janet A. Lawson Bankruptcy Attorney
Janet A. Lawson Bankruptcy Attorney | Janet Lawson
This is a common issue. There is NO requirement under the bankruptcy code to reaffirm mortgage debt. All debt MUST be listed so that was not an error. Attached you will find instructions to report your own payments to the credit agencies. The lenders do not have to report your payments, so to be pissy they don't.
Answer Applies to: California
Replied: 10/24/2013
    Deborah F Bowinski, Attorney & Counselor at Law | Debby Bowinski
    If the negative mark you are referring to is that the loan was discharged in bankruptcy, it is something you cannot change because it is accurate. If it is something more, then you might want to consult your bankruptcy lawyer or a consumer rights lawyer. The loan was discharged in your bankruptcy, but that does not mean that they have not been receiving and applying your payments. You were advised correctly, in my opinion, to not sign a reaffirmation agreement. If you are applying for a new loan you can request a copy of your payment history on the mortgage and provide that to the loan officer or underwriter of the new financing you are hoping to obtain. Most of them will understand exactly what is going on. If you run into someone who doesn't, then look for a different lender.
    Answer Applies to: Colorado
    Replied: 10/24/2013
    Law Office of Lynnmarie A. Johnson
    Law Office of Lynnmarie A. Johnson | Lynnmarie Johnson
    It was included in your bankruptcy and you didn't sign a reaffirmation, so all you can do is challenge if the mortgage company is not showing that you are still making the payments on a timely basis. You can do this over the internet with each of the credit bureaus.
    Answer Applies to: Michigan
    Replied: 10/24/2013
    Law Office of Michael Johnson
    Law Office of Michael Johnson | Michael Johnson
    File motion to reopen case to execute reaff.
    Answer Applies to: Florida
    Replied: 10/24/2013
    Stittleburg Law Office
    Stittleburg Law Office | Bernd Stittleburg
    Your mortgage has to be included in any bankruptcy. Since you did not sign a reaffirmation agreement, all of your post bankruptcy payments are not being reported to the credit reporting agencies. If you want those payments to be reported, you will have to request a payment history from your mortgage company, pull a credit report and then file a dispute form showing that your mortgage payments are current. This may help with your credit.
    Answer Applies to: Georgia
    Replied: 10/24/2013
    Stuart P Gelberg
    Stuart P Gelberg | Stuart P Gelberg
    It was included. Get a print out from the mtge co showing your payments and have it attached to your credit report.
    Answer Applies to: New York
    Replied: 10/24/2013
    Idaho Bankruptcy Law | Paul Ross
    It is bankruptcy fraud to not include a debt in a bankruptcy. One cannot pick and choose which debts to include in bankruptcy. Even if you did not list it, if it was a no asset case, the debt was still discharged (in Idaho).
    Answer Applies to: Idaho
    Replied: 10/24/2013
    Law Office of Barry R. Levine | Barry R. Levine, Esq.
    Unfortunately, this occurs all too often. Not knowing the particulars of your case, there was probably a good reason for the recommendation that you not reaffirm . . . insufficient income, house was underwater, etc. Your house and mortgage were included in your bankruptcy. No way around that. The problem is that in spite of you making two years' worth of payments, the banks do not report the payments to the credit bureaus.
    Answer Applies to: Massachusetts
    Replied: 10/24/2013
    Sara Doty Attorney at Law, LLC | Sara Doty
    All assets and debts must be listed in a Chapter 7 bankruptcy petition. Although you have maintained you payments with your mortgage company, the mortgage company may still make a notation that you previously filed a Chapter 7 bankruptcy and that that that mortgage was a debt listed in your petition. Your mortgage company has a purchase money secured interest in your home. It is not mandatory that a Reaffirmation Agreement be filed with the bankruptcy court. In the event that you do not make your payments, your will face foreclosure.
    Answer Applies to: Alabama
    Replied: 10/24/2013
    CoverLaw | Jim Cover
    Since you discharged your personal liability on the mortgage notwithstanding your payments the report is accurate That said the process for removing inaccurate information from your report is to write a letter to the reporting agency informing them if the error and asking them to remove it.
    Answer Applies to: California
    Replied: 10/24/2013
    The Law Office of Darren Aronow, PC
    The Law Office of Darren Aronow, PC | Darren Aronow
    If you did not reaffirm, then the note was extinguished in your bankruptcy and the credit should report that it was discharged. It sounds like it is correct.
    Answer Applies to: New York
    Replied: 10/24/2013
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