Gadsden, AL asked in Bankruptcy for Alabama

Q: Is it legal for a lending institution to continue to bill a customer after a discharged bankruptcy on the mortgaged

property; and to bill the customer for the Hazard Insurance purchased by the customer? Our attorney provided all required documents to the lender; customer's mortgage record states discharged bankruptcy. Yet they continue to bill us for the loan payments and the insurance.

Related Topics:
3 Lawyer Answers
Robert Keyes
Robert Keyes
Answered
  • Bankruptcy Lawyer
  • Ypsilanti, MI

A: No.

William E. Scully Jr.
William E. Scully Jr.
Answered
  • Daphne, AL
  • Licensed in Alabama

A: Contact your bankruptcy lawyer about this. It sounds like this is a residential mortgage...that is a mortgage on your home. If you are living there and not giving the property up in the bankruptcy, then you will need to work out some kind of an arrangement with the mortgage company. This may be in the form of a 'reaffirmation' of the mortgage. If you have reaffirmed, then the mortgage company is expecting to be paid. If not, then the mortgage company will be trying to find a way to get the property back. They will need to have insurance in place in case some thing happens. If you are not reaffirming, but having the debt discharged, they may continue to bill you for a while, but they won't sue you.

Christopher Kern
Christopher Kern
Answered
  • Bankruptcy Lawyer
  • Mobile, AL
  • Licensed in Alabama

A: A discharge order in bankruptcy acts as a permanent injunction against the collection of a debt discharged. Sanctions may be imposed against a creditor who willfully continues to collect or attempt to collect a discharged debt.

Justia Ask a Lawyer is a forum for consumers to get answers to basic legal questions. Any information sent through Justia Ask a Lawyer is not secure and is done so on a non-confidential basis only.

The use of this website to ask questions or receive answers does not create an attorney–client relationship between you and Justia, or between you and any attorney who receives your information or responds to your questions, nor is it intended to create such a relationship. Additionally, no responses on this forum constitute legal advice, which must be tailored to the specific circumstances of each case. You should not act upon information provided in Justia Ask a Lawyer without seeking professional counsel from an attorney admitted or authorized to practice in your jurisdiction. Justia assumes no responsibility to any person who relies on information contained on or received through this site and disclaims all liability in respect to such information.

Justia cannot guarantee that the information on this website (including any legal information provided by an attorney through this service) is accurate, complete, or up-to-date. While we intend to make every attempt to keep the information on this site current, the owners of and contributors to this site make no claims, promises or guarantees about the accuracy, completeness or adequacy of the information contained in or linked to from this site.