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My mother declared bankruptcy a few years ago, and all of her debts were discharged, including a car that was repossessed, and a house, which she continued making payments on (Was never behind), even though the debt was discharged.

It has now been a few years, in which she's made consistent payments for this house.

However, she is planning on stopping these payments, and letting the bank foreclose, which she thinks will take at least a year (Though some research I've done showed that on average it's around 200-220 days). She believes that since the debt was discharged years ago, there's no consequence of her leaving the house now, and letting it get foreclosed upon.

My question is the following: Is it possible to re-gain responsibility for a discharged debt by continuing to pay for it?

I understand that there's some aspect of this question that can only be answered at a state level;

The scope of the answer I'm looking for here is just whether there's any broad answer of 'No, unless state law says otherwise' or 'Yes - This rule [Insert citation here] states that .... and applies uniformly'

  • That doesn't add up. If the debt on her house was discharged, why would she still make payments on it? – DJClayworth Mar 11 '17 at 21:11
  • Also what country/state is your mother in? – DJClayworth Mar 11 '17 at 21:12
  • She continued making payments on the house because she wanted to continue living in it. This is in Illinois, USA. – schizoid04 Mar 11 '17 at 21:16
  • @schizoid04 under what agreement? Have these payments been rent, or mortgage payments? – Moo Mar 11 '17 at 21:49
  • They have been mortgage payments – schizoid04 Mar 11 '17 at 21:57
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A mortgage consists of two parts. One is the loan itself, and the second is a lien on the house, which allows the lender to repossess the house in the case of default.

When chapter 7 bankruptcy occurs, the mortgage debt is discharged. However bankruptcy does not annul the lien. The lender is still entitled to take possession of the house.

Sometimes it is possible to make an agreement with the lender, in which they agree to not repossess the house in return for continued payments. This is presumably what occurred here. However it almost certainly involves a new agreement, which may or may not be the same as the original mortgage. In any case, the bank still has the lien on the house and can still repossess it.

It is conceivable that there was no additional agreement, or that the bank no longer has the lien, but this is extremely unlikely. The only way to determine it is to closely examine any agreements you did sign, and/or ask the lender about the situation. If you were completely certain you had all the paperwork, and didn't want to talk to the lender, you could take the paperwork to a lawyer and get their opinion.

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