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It sometimes happens, AP over alledged fraudulent mortgage application.

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    It sometimes happens, AP over alledged fraudulent mortgage application.

    Bankruptcy Case #
    BK-2:10-bk-47836
    E. District of CA

    Heritage Pacific Financial filed an AP stating its mortgage debt should not be discharged because the debtors misrepresented information on the Mortgage Application. I will see if I can track down the AP complaint and post it.

    These sorts of suits are rare (very rare on credit card debt), but they do sometimes happen.
    Last edited by HHM; 02-01-2011, 05:23 AM.

    #2
    Wow. I'm curious to see how this one will turn out.
    Filed Chapter 13 02/2006 - Confirmed 05/2006 - Discharged 09/2011
    I'm not an attorney. My replies are merely suggestions or observations, not legal advice. As always, consult with an attorney before making any decisions.

    Comment


      #3
      These are the types of AP's I like.

      1. Debtor and wife applied for a 2nd in March 2007.
      2. Credit application shows Debtor was an architect and wife was an assistant director of some company. Between the 2 their gross wages were $15k/month (husband alone was earning $9.5k/month gross.)
      3. The loan was to be a 2nd on a residence standing behind a $432k 1st. No indication of value. In fact, conveniently the creditor did not attach anything showing that the debtors listed any assets whatsoever.

      A review of the Bk schedules shows:

      1. Debtors resided in the property in question from 2005 through November, 2009 ( unless they lied on the Statement of Financial Affairs, any argument that it was not a primary residence is gone.)
      2. Property was foreclosed in 2009 by the 1st (risk of lending behind a 1st).
      3. Wife is now a student. (Sounds like she lost a good job like many folks, and is going back to school to better herself.)
      4. Husband is still an architect working for a new employer and earning substantially less than what he was earning in early 2007. (Gee, wonder why!!!!!!)

      Now, we really do not know if the debtors lied as to their income back in 2007. The truth will come out through discovery (tax returns the simplest way to determine income). But, unless there is some smoking gun my guess is this AP is a loser for the creditor and, if I am correct, the Debtors will be entitled to seek recover of all legal fees.

      Assuming no smoking gun I would fight this to the end.

      Des.

      Comment


        #4
        Definitely. This AP strikes me as a shot in the dark by the creditor. Some creditor attorney probably talked the bank into it as a way to minimize losses in BK.

        Comment

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