Relief from Stay

[Overmylimit]

So Indymac/Onewest will get there Relief from Stay today on our rental properties, I am 6 days away from discharge. My Attorney sent them a letter saying we didn't oppose the RFS. My question is I know they can start calling and trying to foreclose again but what about the debt itself? On my credit report it shows a zero balance with them now, does this mean I will owe it again? and they will put the balance back up?

[Mensa1]

No, you owe nothing after discharge.

The lenders only remedy is to sell the property and whatever they get from that sale, is what they get; period.

[Overmylimit]

I'm still slightly confused I know once the discharge comes I owe nothing but I'm not discharged yet, so if they get relief from stay today and start trying to collect doesn't there have to be a balance for them to try and collect again? meaning it would have to show back up on my credit wouldn't it?

[mama2three]

They can't try to collect. The only thing they can do is initiate the foreclosure proceedings. They cannot contact you and tell you to pay. The debt is discharged. The only thing remaining is their security in the property

[Overmylimit]

So basically the RFS is just so they can try to foreclose, not so much as to try and collect..

[mama2three]

So basically the RFS is just so they can try to foreclose, not so much as to try and collect..

Correct. The RFS just allows them to initiate foreclosure proceedings. It does not allow them to try to collect or to report negatives or a balance on your credit report

[Overmylimit]

Cool~ Thats what I wanted to know..Thanks

[justbroke]

As stated, they can not try to collect. If you read the order granting the motion from relieve from stay, you'll see a provision whereby the creditor is only allowed to pursue its in rem (property) rights and not any in personam (personal) rights.

They can't even tell you how much you owe or would have owed. That would be an attempt to collect a debt. However, most Districts allow them to contact you in order to "offer" a forbearance, modification or other remedy in order to KEEP the property(s).

[Overmylimit]

I read thru the RFS and you're right, well maybe they will contact me to offer something

[Overmylimit]

So I kept thinking about this, if I am only 5 days away from discharge why wouldn't they just wait till then and then pursue the property wouldn't it be the same?

Also what about how does it show on credit, will it show as a foreclosure after the BK? If so how can they show a foreclosure if my credit shows I owe zero on the property

[justbroke]

So I kept thinking about this, if I am only 5 days away from discharge why wouldn't they just wait till then and then pursue the property wouldn't it be the same?

The discharge may not mean anything. It's the case closing or the Trustee's abandonment of property of the Estate that would clearly remove the property from the Estate. Most creditors do the RFS just to be absolutely sure the Trustee isn't holding the property back as property of the Estate.

Also what about how does it show on credit, will it show as a foreclosure after the BK? If so how can they show a foreclosure if my credit shows I owe zero on the property

It should show as IIB -- included in bankruptcy. If it does get switched to "foreclosure" or "settled for less than owed", then just dispute it. It should read IIB.

[Overmylimit]

Thanks JB! I know in all the months leading up to this I probably read up on this and knew it but now that I am real close to the end I just forgot everything!

[Overmylimit]

So I downloaded the paperwork from the hearing granting the RFS, it has a bunch of legal jargon but it also says; The loan documentation contains Attorney's fees and the movant is an over secured creditor, the motion demands payment of fees and costs??

[BCA2009]

So I downloaded the paperwork from the hearing granting the RFS, it has a bunch of legal jargon but it also says; The loan documentation contains Attorney's fees and the movant is an over secured creditor, the motion demands payment of fees and costs??

If you wanted to redeem the property before foreclosure, they would add those attorney fees to the loan balance. Or if they sell the property they would get those attorney fees before they gave you back the balance (if any). If you are not keeping the property, once you are discharged you owe them nothing. Don't worry about that clause.

[Overmylimit]

Ok cool, I figured thats what would be the case I just wanted to be sure.

Thanks