the lender that holds the 20 % of the mortgage is declaring chapter 11 bankruptcy. how does that affect the homeowner and the loan he has with them?
timothy p
Favorite Answer
The loan is an asset of the lender and doesn't go away. The loan will either be sold to another lender as part of the process or remain through restructuring. It shouldn't have any impact on the borrower.
Dan B
To add to Tim's response, the only affect on the homeowner is that the homeowner will pay their payments to another lender who purchased the assets of the BK lender. The debt will not go away.
?
Probably doesn't affect it in any way at all.