What can we do if unbeknownst to me, the lien for our loan is still attached to our house and we want to sell it? 10 Answers as of September 01, 2016

I filed chapter 7 two years ago. I called the lender on my HELOC to request a reaffirmation form so we could continue paying them. I was told they do not reaffirm HELOCS and it would have to go to bankruptcy.

Ask a Local Attorney. 100% Anonymous. Free Answers.

Free Case Evaluation by a Local Lawyer: Click here
Ronald K. Nims LLC | Ronald K. Nims
It doesn't make any difference whether you reaffirmed on the loan if you want to sell the house. The loan needs to be paid off at the closing or you can't deliver a clean title.
Answer Applies to: Ohio
Replied: 9/1/2016
Janet A. Lawson Bankruptcy Attorney
Janet A. Lawson Bankruptcy Attorney | Janet Lawson
These loans are not discharged in chapter 7. You still owe it. It is too late to reaffirm so that is not your solution. Talk to local counsel about a chapter 13. You "might" be able to strip the loan. Do do that your first must be more than the fair market value.
Answer Applies to: California
Replied: 9/1/2016
Garner Law Office
Garner Law Office | Daniel Garner
If the lien is still attached, the general rule is that you must pay them off when you sell. If you have a mortgage that would absorb all the sales proceeds, however, making the HELOC unsecured in a practical sense, you can reopen your bankruptcy case and file a motion to strip the lien for the HELOC.
Answer Applies to: Oregon
Replied: 8/29/2016
Stephens Gourley & Bywater | David A. Stephens
Chances are good that the bankruptcy discharged your personal liability, but not the lien of the HELOC lender. They may still have a claim against the property. You can sell it, but you have have to pay all or part of the HELOC to clear title.
Answer Applies to: Nevada
Replied: 8/29/2016
A Fresh Start
A Fresh Start | Dorothy G Bunce
Second mortgages are not affected by a bankruptcy discharge. In escrow, this debt will be paid in full with all interest you owe as well as any late fees the contract provides. A reaffirmation is not required for you to continue paying a mortgage. Not getting the answer to this question 2 years ago has probably cost you a lot of money in late fees and your attorney did you no favors by not addressing this issue.
Answer Applies to: Nevada
Replied: 8/29/2016
    R. Steven Chambers PLLC | R. Steven Chambers PLLC
    There is really nothing you can do, short of paying the lien or negotiating with the bank to accept a lesser amount. The lien is not affected by your bankruptcy. Even though you might not be personally liable for the loan, it is still attached to the house.
    Answer Applies to: Utah
    Replied: 8/29/2016
    Law Office of Michael Johnson
    Law Office of Michael Johnson | Michael Johnson
    You still need to pay it.
    Answer Applies to: Florida
    Replied: 8/29/2016
    Robert Louque | Robert Louque
    Two years is way too late to reaffirm a debt anyway. That has to be done before you get a discharge.
    Answer Applies to: Louisiana
    Replied: 8/29/2016
    Richard B. Jacobson & Associates, LLC | Richard B. Jacobson
    A lien on property is not quite the same as a personal claim against you. The personal claim is discharged in the bankruptcy, but the mortgage lien (which is after all what a HELOC really is) is not automatically discharged. The lawyer who represented you in your Bankruptcy should be able to advise you on whether it is possible to reopen the BR case and somehow be rid of the lien or else get rid of the lien some other way. For example, if the balance owed on the first mortgage exceeds the value of the home, you could consider going to state court for a declaratory judgment that the HELOC lien has no value. This could well permit title insurance to be written. If you have not yet retained a lawyer well-versed in real estate, this is a good time to do so.
    Answer Applies to: Wisconsin
    Replied: 8/29/2016
    Goldsmith & Guymon
    Goldsmith & Guymon | Marjorie Guymon
    You will either need to sell at a short sale or find a buyer for the entire sum owed against the house. You don't need to reaffirm to sell the house.
    Answer Applies to: Nevada
    Replied: 8/29/2016
Click to View More Answers: