Expert: Mark J. Markus- California Bankruptcy Attorney - 12/11/2007

Question
QUESTION: HI there,

My husband and I filed Bankruptcy Chpt 7 in Oct 2006.  It was discharged in Jan 2007.

Our 1st and 2nd mortgage was included in the bankruptcy, but it's still going thru foreclosure.  Is that the norm? I was under the impression (by our BK lawyer) that if the debt was incurred before the filing, that it would be discharged with the BK.  

I got a letter from the bank and they wanted us to keep hazard/fire insurance on the house still (which we haven't lived in since June of 2007); because it hasn't sold yet through foreclosure.  Are we still obligated to pay for the property insurance and/or the mortgage loan even if it was forgiven in the BK?

I am confused.  I thought that if the mortgages fell into the BK, then we would be free of debt from the house.

Are we still liable for the house and the mortgage loans?  I can't get a straight answer from anyone.

Please advise.

thank you,

Janie


ANSWER: The debt probably was discharged, but that doesn't extinguish the lien rights the mortgage company has against the property.

No you're not obligated to keep the insurance on the house.  And if your bankruptcy attorney can't answer that simple a question, you probably picked the wrong attorney.

---------- FOLLOW-UP ----------

QUESTION: thank you Mr. Mark J. Markus.

One more question, because the house no longer has property insurance on it, can they stick me with one and bill me for it?  and if they do, will I have to pay for it?

Much thanks and can you refer a "good lawyer" out in Oakland CA?
thanks,
JC



ANSWER: No, if the debt was discharged in your bankruptcy you should owe no further obligation to the mortgage lender.

What kind of attorney do you need in Oakland?

---------- FOLLOW-UP ----------

QUESTION: Thank you so much for the quick reponses...

I need tax law attorney  ( I need to see if I have to claim the 1099 debt forgiven that the 1st mortgage company said they were going to send me).

Also, how do I know what items were discharged in the BK?  I just rec'd a letter that said we were discharged, but it didn't list any specific items.

Although, I did get a letter from the trustee (he took our tax return money) that said the tax money was paid to the student loans people, to himself for an administrative bill and a cell phone bill.

thanks again.
janie

Answer
Sorry, I don't know any tax attorneys in that area.

Dischargeable debts are all debts not of the types listed in section 523 of the US Bankruptcy Code.  If your attorney can't tell you which ones were discharged, then you might want to take a look at http://caselaw.lp.findlaw.com/scripts/ts_search.pl?title=11&sec=523 but that will likely confuse you.