Posted on: 23rd Mar, 2012 02:44am
Bankruptcy gives temporary protection against lawsuits. So, can a lender sue you after bankruptcy? Once the time period of automatic stay is over, your lender is free to sue you.
If you file bankruptcy, court puts an automatic stay on any legal action taken against you by the lender. Without the approval of the bankruptcy lawyer, your lender can’t sue you for non-payments. This automatic stay starts from bankruptcy filing and stays over the entire bankruptcy proceeding.
If you file bankruptcy, court puts an automatic stay on any legal action taken against you by the lender. Without the approval of the bankruptcy lawyer, your lender can’t sue you for non-payments. This automatic stay starts from bankruptcy filing and stays over the entire bankruptcy proceeding.
Termination of the automatic stay
With the termination of the bankruptcy proceedings, automatic stay also expires. It implies that when the bankruptcy attorney signs over the final order, automatic stay goes off. Then the lender can file lawsuits against you even without taking the consent of the court.Request for relief by the lender
Sometimes the lender can request the judge to get relaxation in automatic stay. If you have filed Chapter 7 bankruptcy, then usually the request of the lender is accepted. However, in case you have filed Chapter 13 bankruptcy, then the court usually denies the request of the lender.
my friend is facing problems with her bankruptcy filing. she and her husband did a chapter 13 bankruptcy filing. they had a 1st and 2nd mortgage which was included in the mortgage. while they were in bankruptcy, her husband lost his job and could not complete the bankruptcy. it was dismissed. now the lender is trying to sue them. can they do this? what about the second mortgage?
If the bankruptcy filing was dismissed, then the lender has the rights to come after your friend's husband in order to recover the debts. The husband will also be liable for paying the second mortgage in full to the lender. The husband should contact the lender and check out if the lender is ready to offer you any repayment plan to pay off the debts.
Hi Karmel,
If the bankruptcy filing was dismissed, then the lender will be able to sue your friend's husband for the balance debt amount. As Niicss has said, even the second lender will be able to come after your friend's husband to recover his debts. Your friend's husband will be liable for paying off both the loans in full.
Thanks
If the bankruptcy filing was dismissed, then the lender will be able to sue your friend's husband for the balance debt amount. As Niicss has said, even the second lender will be able to come after your friend's husband to recover his debts. Your friend's husband will be liable for paying off both the loans in full.
Thanks
Usually, a lender can not sue a borrower on a first mortgage, but a lender can sue you on second mortgage.
>>Can they do this? What about the second mortgage?
Yes - they're no longer under the protection of the bankruptcy code.
Yes - they're no longer under the protection of the bankruptcy code.
