Dearborn, MI asked in Bankruptcy, Consumer Law and Foreclosure for Michigan

Q: I owed SBA disaster loan of $24,000 and then in 2019 I did a chapter 7 due to financial problems, .

The sba loan was discharged, the problems is, everytime I try to refinance my house, they still block the refinance and demand the $24000 , and banks back away.

Is this legal what they are doing or illegal?

What can I do for them cease-and-desist?

1 Lawyer Answer
Thomas. R. Morris
Thomas. R. Morris
  • Bankruptcy Lawyer
  • Dexter, MI
  • Licensed in Michigan

A: The bankruptcy discharge prohibits a creditor from demanding payment of a discharged debt. However, it does not require a prospective lender to lend to you. Therefore, it is illegal for the creditor holding a discharged debt to try to enforce it against you, but legal for a bank to deny you a loan.

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.