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A second mortgage was listed as unsecured debt in chapter 7 bankruptcy if the creditor doesn't object, will this be discharged? |
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Any and all debts listed in a chapter 7 bankruptcy is subject to discharge, which includes the second mortgage as well as the first mortgage. What this means is that once the discharge is issued in a case, the lender can no longer collect from the debtor personally through wage garnishment or other legal actions. However, the security interest (aka lien) secured against the property will remain. So if the property is sold in the future, the 2nd mortgage lien will need to be satisfied by either the person selling the house or the person buying the house. |
