Chapter 7 Debtor Did Not Reaffirm Mortgage

Hello sorry to have to ask another new question here, but we did not reaffirm our mortgages or one of our car loans in our bankruptcy but we have been continuing to pay for them. I pulled my credit report today just to take a look at it and of course neither are showing up on it. We owe more on the house than what it is worth and more on the car than what it is worth. My first question is this, if we wanted to get rid of the car or just give it back will there be repercussions? And the second is we have been making on time payments on the mortgages for at least a year before our bankruptcy and recently when I called in to get some information about our taxes there was an automated message saying we may be eligible for some new modification program. If we qualify for this program and we do decide to accept the new terms will this essentially reaffirm our mortgages (or mortgage if that's the case) and start showing on our credit report?

When it comes to mortgages in Chapter 7 bankruptcy you are advised to continue to make your payments on both your first and second mortgage if you plan to keep your home. This means that if you stop making your payments and are out of bankruptcy then the bank has a right to foreclose on the home. What bankruptcy protects you against if you did not sign a reaffirmation agreement is a deficiency judgment against you if the house were to foreclose. Chapter 7 bankruptcy cannot eliminate your second mortgage. If you want more on reaffirmation agreements you can find some information here:
Reaffirmation Agreements in Bankruptcy

I filled bankruptcy chapter 7 in 07/2008.Just few months ago checked my credit report,where I notised that mortgage didn't get reaffirmed.Called my attorney,called the GMAC,both said they can't help.Too late...Both were pointing fingers at each other.Me-I trusted my attorney :( .At the end attorney said it wiil be better in the future.
Just a month ago,I contacted GMAC for affordable mortgage modification.My payment is 38% of my gross income.The GMAC said They can't help.They said I can'y afford my mortgage,they can't lower to 31%.Well ...This week It was first time I am late...Never was late since 2003.I asked for help...My house value is lower than what I owe.I owe 241K and zilow.com values 208K.and there are many other homes lower ...What are my options,what should I do? Please anybody,help!!! I live in Illinois.Make $5000/month gross...motgage 1514,p.tax-$490.HOI-%80.Just $100 in credit cards.I am single mom of 2.

Okay, so we tried to get into the HAFA program to do a short sale....our mortgage is a year past due...but all other debt is current. We are going to file Chap 7 to protect ourselves, but want to start making mortgage payments if we are allowed to keep the house.

What are the odds the bamk will agree. Mortgage on house is $330, value of home near $250. Thanks!

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Ok. I'm trying to gain some insight on the current situation I'm going through. My husband and I filed for chapter 7 bankruptcy almost 3 years ago and was discharged in Feb of 2008. We wanted to reaffirm our cars and house and this was put on schedule D to do so, not on schedule F. The banks that we go through were all notified of our intentions and should have sent the agreements to be reaffirmed. The bank that our cars were through (Horizon) sent the reaffirmation paper. Apparently, the bank we had a mortgage through (Washington Mutual) never sent the reaffirmation paper to our lawyer. Our loan was bought out by Chase about 1 year later. I thought everything was good until I saw my credit report stating my payments to my house were not being reported. This is hurting my credit score! I called Chase and they said I would have to first re-open my case and after that was done I would have to call them (Chase) to get the reaffirmation paper to sign. When I called the lawyer that handled my case he said that it was Washington Mutual's responsibility to send the reaffirnmation paper when they were notified 3 years ago, and that they failed to do so. Re-opening this case would cost me upwards of $500. Shoudn't the bank be responsible when I have proof that they were sent this information and didn't do their part??

[QUOTE=Anonymous;751711]Ok. I'm trying to gain some insight on the current situation I'm going through. My husband and I filed for chapter 7 bankruptcy almost 3 years ago and was discharged in Feb of 2008. We wanted to reaffirm our cars and house and this was put on schedule D to do so, not on schedule F. The banks that we go through were all notified of our intentions and should have sent the agreements to be reaffirmed. The bank that our cars were through (Horizon) sent the reaffirmation paper. Apparently, the bank we had a mortgage through (Washington Mutual) never sent the reaffirmation paper to our lawyer. Our loan was bought out by Chase about 1 year later. I thought everything was good until I saw my credit report stating my payments to my house were not being reported. This is hurting my credit score! I called Chase and they said I would have to first re-open my case and after that was done I would have to call them (Chase) to get the reaffirmation paper to sign. When I called the lawyer that handled my case he said that it was Washington Mutual's responsibility to send the reaffirnmation paper when they were notified 3 years ago, and that they failed to do so. Re-opening this case would cost me upwards of $500. Shoudn't the bank be responsible when I have proof that they were sent this information and didn't do their part??[/QUOTE]

Okay, you have raised several issues here and I am sure you have read some of my posts so I apologize in advance for this "one sided" response.

1. 99.9% of the time it is the creditor who drafts and sends reaffirmation agreements to debtors or debtors' counsel.

2. Reaffirming a mortgage is dumb since, if you had reaffirmed and at some time during the remaining 30 years of the loan or prior to you selling the property, which ever happened 1st, and then defaulted you would have been sued. I do not know if Michigan is an anti deficiency state but, assuming it is not, why on earth would you want to take that chance?

3. Since you had a WaMu loan I have to wonder if it was Fannie Mae/Freddie Mac backed. I have been told (although I cannot verify this) that lenders whose loans are backed by Fannie or Freddie have been instructed by Fannie/Freddie NOT TO allow reaffirmation agreements. Again, I do not know this 1st hand but considering that there is no reason to reaffirm I would not be surprised if this is the policy of Fannie/Freddie.

4. While you could spend the $$ to reopen your case (legal fees AND a Court reopening fee) there is a good possibility that your Judge simply will not sign an Order approving something that does not (except in your mind) benefit you in any way, shape or form. If that were to happen you would have wasted your time and money.

5. How it is reported to the credit reporting agency should not concern you. You can re-establish your credit in other ways. Reaffirming so that "my credit will look better" is one of the dumbest reasons I can think of. By the way, why do you even need credit? You already have a home. Vehicle lenders only want to see a discharge. Do you plan on taking out a bunch of credit cards and loans? Cash is king, use it. Credit is a privilege, don't abuse it and don't use it unless it is absolutely necessary.

Bottom line, you will do what you think is right for you. If you manage to enter into a reaff and all works out that is great. But if you default you will find yourself filing another bk, something I am sure you never want to repeat.

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thank you for your reply. I will check out your other post.
However, can you please clarify what do you mean by
Trustee has some money to spread? Our house has not equity right now.

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Des,
thank you for your quick reply. How can I find out how much allowed homestead exemption amount in our case? How can it be maximized.
Do you think we can sue the Bank for faulty transaction?
I don't understand any of it and I will definitely make some calls tomorrow first thing in the morning.

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I was dicharged in chapter7. my laywers told me that it was best not to reaffim the house, i thought we did reaffim when we signed the form chapter 7 individual debtors statement of intent.does that form mean we reaffimed or does it mean that is what we intended to do in the future? credit reports says we did not reaffim...
can someone explain to me what that form was for?

The Statement of Intentions is just that, a statement of what you intend to do. It is not a reaffirmation agreement. A Reaffirmation Agreement, which must be entered into BEFORE you obtain a Discharge, is a separate document that tells the lender that "despite my bk I will pay you, and, if I don't, you can repo/foreclose the collateral and sue the crap out of me for the difference".

You should not have reaffirmed a mortgage and your attorney was correct in telling you such. Reaffirming a large debt like a home mortgage, IMHO, would have been a dumb thing to do.

Des.

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I agree with the attorney's assessment as to amending Schedule C. At least if the Trustee sells the property you will get some $$ out of it as your homestead.

In response to:

"We have an obligation to Coop to convert into Condo by January 15th. But, since the mortgage is defective, we can not refinance and conversion can not be done.
Attorney says it would take around 1.5-2 years for the Trustee finalize the case. During this time, if we surrender the house ourselves, nobody can claim payment from us until we move out. "

Please ask your attorney if this (bold) is correct. I do not know how coops work therefore I do not know if 11 USC 523(a)16 applies in your case. This provision makes the following non-dischargeable:

"a fee or assessment that becomes due and payable after the order for releif (the filing date) to a membership association with respect to the debtor's interest in a unit that has condominium ownership, in a share of a cooperative corporation, or a lot in a homeowners association for as long as the debtor or the trustee has a legal, equitable or possessory ownership interest in such unit, such corporation or such lot."

If 523(a)(16) applies then you must pay all assessments, dues or fees until the property is sold or lost to a foreclosure.

Best regards.

Des.

i DID A CHAPTER 7 AND DID NOT REAFFIRM MY MORTGAGE, I HAVE BEEN DISCHARGED FOR ABOUT A YEAR. HOWEVER I WAS ABLE TO GET A MODIFICATION OF MY HOME LOAN, DOES THAT PUT ME IN A DIFFERENT BRACKET. IF I SHOULD WALK AWAY FROM MY HOUSE, WILL I BE RESPONSIBLE FOR ANY MONIES IF THE HOUSE ISN'T SOLD AT WHAT I OWE. MY MORTGAGE COMPANY SAYS THAT I WOULD RECEIVE A 1099 OF THE DIFFERENCE AND ADD IT AS A INCOME

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"I DID A CHAPTER 7 AND DID NOT REAFFIRM MY MORTGAGE, I HAVE BEEN DISCHARGED FOR ABOUT A YEAR. HOWEVER I WAS ABLE TO GET A MODIFICATION OF MY HOME LOAN, DOES THAT PUT ME IN A DIFFERENT BRACKET. IF I SHOULD WALK AWAY FROM MY HOUSE, WILL I BE RESPONSIBLE FOR ANY MONIES IF THE HOUSE ISN'T SOLD AT WHAT I OWE. MY MORTGAGE COMPANY SAYS THAT I WOULD RECEIVE A 1099 OF THE DIFFERENCE AND ADD IT AS A INCOME"

1. Smart that you did not reaffirm.

2. A loan modification is not a reaffirmation agreement that must be approved by the Court. A lender would be hard pressed to claim that once it forecloses it could sue you based upon the modification. While there is a small minority who differ in this, I have yet to see it happen. Pull out your loan modification documents. If you went through the "Making Homes Affordable" program you should find language in there that talks about a discharge in bk and the fact that if you default the lender will go after the property only.

3. Yes, the lender can issue the 1099 however, since the underlying debt was discharged in the bk any tax consequence will be waived under the Internal Revenue Code (I think Section 103). If you get a 1099 use a real CPA, not one of those "commercial" tax preparation services and supply the CPA with a copy of your Schedule D (list of secured debt) and the Discharge.

Des.

That is exactly what happened to me!
You got it! I am doing exactly as you.

We got it!

avoiding 1099 income

if u are insolvent,you do not owe cancellation of debt income tax...

Looking for some clarification here:

We were 2 months behind on our mortgage when we filed for Chapter 7 in Illinois in July of '09. At the time, we stated our intent to keep the property (it's our primary/only residence) and reaffirm. Our attorney said we didn't need to do that and didn't include it so we only signed a reaffirmation for one car that we were still making payments on. At the same time, we started working with the mortgage lender in September of '09 on a modification, and have been paying a trial amount for the past 14 months (have submitted the mod papers 3 times now).

The house is upside down -- we currently owe about $113K and the market value is estimated around 90K, down from about $140K when we originally took out the refi in 2006. We haven't had money to make improvements, so compared to other houses in the neighborhood, I don't think it would sell for much more than 70-75K on a good day.

The bk was discharged in October of 09. Now, my husband has been offered a promotion and large raise in another state and we want to move. We've already been turned down for 2 different gov't modification programs, and the bank says they're now putting us in for one of their plans. I'm guessing we probably won't be approved for that one either.

We've been debating whether to walk away and let the bank foreclose, try to do a short sale, or see if they'll accept a Deed in Lieu, but are trying to figure out our exposure as far as any deficiency goes. We're in much better financial shape now, but still living mostly paycheck to paycheck without a lot of disposable income.

Here's the meat of the question: Since we never signed a reaffirmation, and have received our discharge, are we liable for the debt? We've been making monthly payments, but they've been trial mod payments, and not our regular mortgage amount. I'd like to consult with an attorney, but I don't know whether to go back to our bankruptcy firm or contact a real estate attorney.

Any thoughts? Thanks in advance for any feedback you can offer.

To Sahmiam,

Of course you should check with your bk attny but, since you did not reaffirm the mortgage, if you walk away the lender can only foreclose on the property. You have no financial exposure and the fact that you have been voluntarily making payments does not change that.

If you modify your loan at this time I doubt you will revive or create new personal liability as a loan modification is not the same as an official Reaffirmation Agreement. However, to be 100% sure, don't complete the modification process if you are not going to keep the property.

Des.

Thanks, Des. That's pretty much the way we're leaning -- I just wanted to make sure I was interpreting things correctly before we contacted the attorney. I was thinking we needed to talk to a real estate attorney about the short sale/deed in lieu option, but I guess we need to talk to the bk attorney first about exactlly what was discharged in the Chapter 7.

I did find our exemption amount in our bk papers -- it was $30,000. I was thinking that was what would limit our liability for the deficiency, but now I'm thinking we may not be liable for any of it.

I'll post back for other readers once we meet with the attorney(s).

Sahm

Des, question. Good work by the way. I'm unemployed and seeking Chapter 7 (filing myself). Glad I found this site as to reaffirm or not. Currently in a forebearance mod with BB&T paying half of 1st morgage monthly. Note on 1st is 150k and 50k on 2nd. Both are through BB&T backed by Fanny Mae, I believe. I understand you can only "shrink" the 2nd by going through Chapt 13 if your first mortgage is underwater. However, I've read where there may be a possibility of shrinking the 2nd down to market value of home if 1st has a small equity balance. IE 200k owed; home valued at $160; 1st has equity of 10k, and 2nd is underwater by 40k. Could 2nd be shrunk in this example? Is it possible to have all cc debt discharged under Chap 13, shrink 2nd note, and have no payment plan due to job status?

Also, If I don't reaffirm and stop paying on 2nd in Chap 7, how likely will bank foreclose on 1st since both are owned by BB&T? Home appreciation in my area is limited.

I thought about reaffirming the 1st and not the 2nd, or just not reaffirming either and still not pay on 2nd note. My state has a deficientcy law. Concern too from reading on site is judge may not allow me to keep house at all. Is that possible?

If there is one cent of equity in the home after consideration of the 1st you simply cannot modify the rights of the 2nd mortgage lender in any bk if the property is your principal residence. If there is no equity at all after considering the 1st then you can "strip off" the 2nd through either a Chapter 13 or a Chapter 11. The 2nd would be treated as unsecured and would share in whatever "pie" you are paying (if anything) to all unsecured creditors such as credit cards, medical bills etc.

Having said that, homeowners have been successful (even if in small numbers) in negotiating directly with the 2nd for the lien release by offering a cash buy-out. This has nothing to do with bk.

As it relates to the Chapter 7:

1. Reaffirming either mortgage is a bad idea as, should you default in the future, the lender gets the property and can sue you for the balance owed (you indicated you are in a deficiency State). The lender that does not foreclose will simply sue you under the promissory note you signed. The overall financial exposure ($50k to the 2nd plus deficiency on 1st) creates much to much risk to ever want to sign a reaffirmation agreement.

2. The bk Judge only gets involved in your decision to keep the property if you sign a Reaffirmation Agreement. If you "stay and pay" the Judge does not care since you have not re-obligated yourself to the debt.

3. If you are attempting to modify the loan (like so many others) and are successful, the actual loan modification papers (especially if you are going through the Making Homes Affordable program) will have specific language that should you default the lender will look solely to the property and will recognize the Discharge. A loan modification is not a Reaffirmation Agreement. (However there is an argument that it is akin to a "new" loan as there is new "consideration" being given. If it is a "new" loan it would be a post bk filing debt and not protected by the Discharge. I have always been worried over this argument but I have yet to see it raised - mostly because not enough time has gone by for consumers to have defaulted under the "new" loan).

4. If you make a calculated decision not to pay your 2nd you need to realize that the 2nd can foreclose and, considering the 1st & 2nd are through the same lender, such is a possibility. This still is not a bad thing since you did not reaffirm and can just move on.

5. Unless the loans have a "cross collateralization" clause which states that a default under 1 is a default under the other and that either can exercise the right to foreclose on the collateral, defaulting under the 2nd while paying the 1st is not an issue. You need to look at the loan documents for the 1st. I can tell you that unless you are dealing with a Credit Union or a SBA (business) loan it is unlikely that you will find such a provision. Loans are usually independent of each other even when through the same lender.

I hope this answers all of your questions. If not, feel free to post more.

Des.

I was discharged in October 2009 and my home loans were not reaffirmed. I can however afford my house, but it is upside down. Here are my questions.

1) The second mortgage on a rental property is still reporting "on-time payments" even though it was not reaffirmed. Should I notify the credit bureaus and get it marked as "included in bankruptcy"? My goal is to improve my credit score. Will my score benefit more from showing on time payments or having it marked as "included in bankruptcy? The advantage to the "included in bankruptcy" could stem from the fact that the credit limit is equal to the balance so it shows that I have maximized that available credit.

2) If I walked away from my house because I am upside down, would the foreclosure appear on my credit report anywhere? AND, would it prevent me from receiving a mortgage 2 years after my discharge if my credit score allows for it?

Thanks for any comments!

If you haven't reaffirmed the mortgage, then the lender shouldn't normally report the account to the credit bureaus. You can request the lender as well as the credit bureaus to update your account status in your credit report. Reporting on time payments will definitely have a positive affect on your credit report.

If the property is foreclosed by the lender after you walkaway, it will be mentioned in your credit report. However, the lender won't be able to come after you for the deficient balance resulting from the sale of the property.

To BCA :


You had mentioned on your post that B of A & Wells Fargo are no longer doing reaffirmations. It is a new agreement and the court canno require the bank to sign it. Where can I find this information? Thanks for your help to this matter

Legal counsel or with the right attorney can help you in chapter 13.

You should directly contact Bank of America and Wells Fargo and check out whether or not they are reaffirming the mortgage. It is better to get direct information from them.

thanks ,BCA for the information. i just went thru bankruptcy, and still have the 60 days to reaffirm the house. But i am not sure what to do, because it has a varible rate that will kick in a year. Than i amnot sure if i can still make the payments. Right now my plan is to keep the house. But i wondered if i kept the payments current, and did not sign the reaffirmation paper, if i could still sell the house, and keep what is left if any after the loan is paid off. I just am concerned if i sign it, than can't make payments and walk away, i know i can be sued for that money. its a big decision, when you are not sure what is going to happen later on. Shoot I thought my house would be my lifeline if i sold it, now i would never get what i owe!

If you do not reaffirm the loan but still keep making the payments, you will be able to keep the property. Later on, if you wish, you can walkaway from the property and lender won't be able to come after you for the mortgage payments. The lender will sell off the property in order to recover as much dues as possible. However, if you reaffirm the mortgage, then you will become personally liable for making the mortgage payments on time. If you don't do so, the lender will foreclose the property and you'll be responsible for the balance amount.

Has anyone tried to get a new mortgage after filing C7, not reaffirming, and doing a short sale? Can a mortgage company put "foreclosure" on your credit record in addition to "discharged in Chapter 7 bankruptcy". Our Chapter 7 was discharged in October 2008. We continued to make our house payments but are no longer able to continue due to my illness and reduction in income. We are in the process of selling our house in a short sale. We want to buy another house. Any feedback or information anyone can provide will be appreciated.

The mortgage company can report the foreclosure to the credit bureaus even though the property was included in your bankruptcy filing. After a Chapter 7 bankruptcy and foreclosure, you need to wait for 2 years to get FHA loan and 4 years to get a conventional loan.

Can a short sale affect the credit record?

A short sale will definitely affect your credit report. It will be considered as a negative item and will remain in your credit report for 7 years. Moreover, it will lower your scores by around 80 - 100 points. Also, you'll be liable for paying off the balance amount, resulting from the sale of the property, to the lender.

Here's my situation .. same as many (bless them all). It's a tough time.

Laid off after 20 years with the same company. Unemployed for over a year. Finally got a job but at a much lower salary. Making enough now to make mortgage payment and 2nd mrtg payment but that's it.

I owe 205K on my first mortgage. 120K on the second mortgage. The house next door just sold for 245K (after more than a year on the market) and mine is much smaller so I said my house was worth about 230K (down from the $300 purchase price eight years ago).

Filed BK7 and I showed up with about 12 of my attorneys other clients at the 341 meeting. He told me not to reaffirm anything. Even when asked by the trustee whether I was sure that I didn't want to reaffirm the house, he just nodded. Now the trustee is asking more about value of my house saying new homes in the subdivision (which no one is buying) are selling for 350K. A real estate appraiser has been calling me asking questions. The zillow site shows the house next door at 245K but my house is estimated at $350.

I want to be sure I can keep my house. My lawyer is saying let the trustee do his thing but .. I'm very worried. Should I have filed for reaffirmation on the first mortgage?

My family is going through very bad medical troubles now and being evicted from the house is not on my to do list.

I just need some reassurance.

Matt

As you did not reaffirm the mortgage, it will be tough for you to keep the property. The lender will foreclose and try to sell off the property in order to recover his own dues. It would have been better if you could have reaffirmed your mortgage while you were in bankruptcy filing.

With all due respect to Anna, in 99.999% of the situations reaffirming a mortgage 1) IS NOT required under the Bk code and 2) is a HUGE mistake.

[SIZE=2][/SIZE]If you reaffirm a debt and then fail to live up to making the payments the lender will foreclose and then sue the crap out of you for any deficiency, especially if you ARE NOT in an anti-deficiency State. If you "stay and pay" - continue to remain current - and sometime in the future default, the lender gets its property back but CANNOT sue you.

I never, ever, ever allow my clients to reaffirm mortgages. Why would anyone think it is in their best interest to expose themselves to such a huge financial risk? I even laugh when lenders send me reaffs for 6 figure loans. What a joke. I have been in this business for 23 years and I have never, ever had a client come back with an issue over this with the exception of whether or not the debt is reported as being paid. Who cares? Let's see. . . . reported on credit report or being sued. . . no brainer.

Des.

A lot of BK attorneys will tell you to not reaffirm your mortgage if you've included it in your Chapt 7. When you are discharged, the mortage is technically discharged and you are no longer responsible for the debt, but as long as you are still paying the payments and are not behind, the bank will not foreclose and you can remain in the home.

Should something happen a year or so down the road and your financial situation changes, you would then have the option of walking away and you would not be responsible for any deficiency as you might be in the normal foreclosure process because the mortgage was discharged in your bankruptcy. If you had reaffirmed the mortgage, you are no longer protected by the discharge and will be on the hook for any deficiency judgment after the sherrif's sale.

Don't forget though, the mortgage and lien are two different things. Although you are no longer responsible for the actual mortgage if you do not reaffirm, if you were to sell your home you would have to satisfy the mortgage lien just as you would if there was no BK. The BK doesn't discharge the lien, just the debt.

Hello IM like many other facing difficulty, I decided I will take the BK routh however after reading more and more I only get more confused about the subject. I currently have a 1st of approx 488k that has been modified approx 6 months ago or a bit longer and is somewhat reasonable as of now 40yr loan. The triky part is my Heloc obtained through a re fi couple years back which was use to pay of my old 2nd. I havent payd anything on the Heloc for approx 2yrs now, I havent recieved anything for over 1 yr now on it. I would like to keep my home if by all means posible but I need to find a way to get my life back since my unsecured debts of approx 30k are serving me left and right as we speak and due to job change and other prob I cant afford. Current home value is approx 350-365k. i know its unreal to many to keep something so negative but to me its worth it for now but I cant or wont if theirs nothing I can do to wipe out the HELOC and personal debt. Any help would be greatly appreciated. Im in So. California

What type of BK should or would I be able to take the most advantage when it comes to my heloc...I dont know where to start and what to look for when it comes to attorneys. I would hate to go through a bk to only years down the line find out something was not done right . any help would b greatly appreciated. thanks

I just went through a chapter 7 here in California. My home had a 1st mortgage($640,000) and a heloc($120,000). Both of those loans were discharged in my chapter 7. I then contacted the first(wells Fargo) and asked if they could modify my discharged 1st mortgage. After 3 months of trying to modify my loan they did it. I have not signed anything but my second(heloc) put a lien on my property. My first and second are with wells Fargo. My home is worth $575,000. Wells Fargo is getting a subordination for the second. If I go through with this, say 6 years down the road, when the house may have some equiity, can the second force me to sell the house?

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Once your bankruptcy is filed and mortgage is "discharged" no payments whether on time or late are updated on your credit report. We are currently going through this. Our mortgage didnt reaffirm and our lawyer did not explain it thoroughly which I am kind of glad he didnt. When I found that our mortgage was listed as discharged on our credit report I went ballistic. I was told by the credit bureau that once its reported discharged there is not activity and will not be updated.

It is true that unless you reaffirm your mortgage, your lender won't be ready to report your payments to the credit bureaus. This is because after a discharge, you don't remain personally liable for the payments so the lender also does not remain liable for reporting it. Once you reaffirm the mortgage, you become personally liable for paying off the debts. Thus, the lender also becomes liable to report the payments to the credit bureaus.

Does that mean if you begin to fall behind on payments (maybe just 1 month) the lender can begin forclosure or anytime they feel like it? This is after a discharge and have not reaffirmed.

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