Mortgage listed as "Open" on credit report post discharge-is this a problem!?

[Diesel73L]

I pulled our credit reports six months after our CH7 discharge and just now. Both times, all three credit bureaus list our mortgage as "Open" with regard to Account Status, and "Paying as agreed" with regard to Payment Status. The two credit cards that were discharged say "Closed" and "Included in CH7 Bankruptcy." The remaining balance is even correct, so clearly the bank is still reporting to the credit bureaus. I dug out our petition just to be sure, and our mortgage is listed.

Now that I think of it, the bank never stopped sending us mortgage statements all through the process of our bankruptcy, and they never gave us a hard time with our accounts there (we do all of our banking there), and finally, they never contacted us to reaffirm after the fact, not that we would have. I am really worried that something went wrong here. Should I contact my lawyer? Should I contact the bank? The credit bureaus? The reason this is such an issue is that we are seriously beginning to consider walking away because the value in our home will likely never recover, but if we are on the hook for the debt, that changes things dramatically...

[bcohen]

Do not worry that how the mortgage--or any other debt--appears on your credit reports influences its collectability. It doesn't. If you filed for Chapter 7 bankruptcy, then all of the debts which were listed (and even those which were not listed in a "non-asset" case) are discharged unless explicitly reaffirmed. There is no "accidental" reaffirmation, so retaining a vehicle or house or other piece of secured property and continuing to pay the loan does not make the debt reaffirmed. So legally, you could walk, and the mortgage lender cannot pursue you for any deficiency balance, nor can they report the foreclosure on your credit reports.

That being said, are you sure that walking away is a good option? One of the things I have noticed in the past few years is that as more and more foreclosed houses are being bought up by large property management companies and turned into rentals, the asking rents on single-family homes, duplexes, and 3 and 4 bedroom apartments have skyrocketed. In many cases, the monthly rent far exceeds the monthly cost to own a similar property! So while people who can downsize from a house to a 1-bedroom or 2-bedroom apartment can still save money by walking away, people who need a larger space often end up paying more for less if they choose to walk. This is something which you need to think about very carefully before you walk away! Add up the TOTAL monthly cost to stay in the house--mortgage, property taxes, insurance, repairs--and see how that compares to what you would pay for rent.

[tobee43]

good advise bcohen. also keep in mind equity will most likely never be what it was. people used their homes for banks!! we will never see that again.

we now feel we don't care about equity, we just care about having a roof over our heads and not accumulating any debt. weigh out all your options. for us the walk was the best decision we ever made, as we would have left our children in debt forever...now that we look back it was really bad. so think it through do what's best for you and yours in the long run. the home we left is still 200k underwater with no way back, badly in need of septic repairs. no way, now how do we regret our decision.

[tobee43]

sorry, i forgot to say, YES!!! take a look at your petition!!!! make CERTAIN that your mortgage was in fact listed! if it was then contact the agencies with copies and tell them to stop reporting the incorrect information. ours does in FACT read: IIB!!! yours should as well IF it was included. so they are most likely reporting wrong and you need to contact via writing certified mail and get it corrected.