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Doc203

Junior Member
What is the name of your state? Ohio

I posted here before, but I think I made it a little confusing so I decided to sit down and write it all out to see if I can get some help. I am totally exhausted, lost, and quite frankly tired of living this way. Here goes:

About 6 yrs ago after selling a business I was sued. I lost the suit and had to file bankruptcy. Before filing, I lost my home and they sold it at a sheriffs sale. I filed bankrupcty on the remaning balance on the home (roughly 25-30K), as well as a vehicle that I had.

In March 2002 I went to the same bank and asked them what I would need to do to do business with them again. The banker told me that if I took out a loan for $25K to pay what was left of the home loan they would loan us money for the business that I had and for us to buy a home. At the same time that I took out the $25K for them to do bus with me again, I also took out a $6k loan to buy computers for my business and a $10K line of credit that I could use and repay as needed by paying the monthly interest on what was currently being used of that $10k. In July of 2002 we purchased a home thru the same bank, then in september I upped the credit line to $25K.

I since closed my business and took on a consulting project that didn't work out and am now unemployed again. We have been in default on the $25k re-payment loan, the $25K line of credit and the $6k loan and they have a judgement against me for all 3 in the amount of $55k. Our mortgage is currently 2 1/2 mo's behind, and they are threatening foreclosure. We have roughly 30k in equity.

Ok now that the background is there, here are the questions.

1) The bank claimed that even if we get current on our mortgage they could Foreclose our home based on the $55k judgement. I have the money to get current, but I don't want to do that if they are going to foreclose anyway.

2) Can they legally loan me $25k in order for me to be able to do business with them again, especially since I filed bankruptcy on the money that loan was supposed to re-pay? By the way, the loan "Purpose" on the note states that it is for "Business: Refinance." When I got the loan I signed the chack and gave it back to the banker. I do not know what happened to it from there. Also, I had no other loans with them (Good or default) that that money could have re-payed.

Bank information:

During the past year this bank was investigated for the way they were conducting business. It resulted in The Vice President of the bank, the same guy that I always dealt with, leaving. It was rumored that if he left he could avoid prosecution. I asked the new loan officer that I had to deal with what was happening and she said that the Federal Gov came in and was looking into all of their records and they were no longer aloud to give loans based on the "Good ole boy system." That was in July of 03, then in March of 04 the bank announced that they were being bought out.

We were working with bank before the buyout, trying to get caught up. Now, the new bank is getting ready to take over in Sept and they are really putting the pressure on.

One other side note... this bank also has my credit VERY screwed up. I will go into detail on that also if it pertains.

I hope this is all understandable. Any advise/help greatly appreciated.
 
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You may have attempted to re-write your old post, but I'm sorry to say that it's still confusing. So what is your question? Was it legal for the bank to loan you the money after you filed for bankruptcy? I never heard of a law that makes it illegal to lend money to people who filed for bankruptcy. Banks can pretty much lend to whomever they want (except for special cases - like the enemy of the state, etc), and they apparently did by lending money to you.

The fact that the bank may be under investigation of some sort - doesn't change the fact that you defaulted on your loan and you are responsible for it. Were you perhaps dreaming about a possibility that somehow, your loan from this bank would be invalidated, and you'd be off the hook ?
 
A

amortgageman

Guest
It is a little more clear now since you have described the order of obtaining the loans. Since the house was bought after you obtained the two business loans, then the business loans wouldd have nothing to do with your mortage unless you resigned more papers to include the home as collateral.

In short, your mortgage is separate of your business loans, and no, I do not thinnk that they are able to get away with this.

Ohio's state website is pretty decent. Find on therre the contact information for the state banking regulators, and take that direction.
 

Doc203

Junior Member
Thanks, amortgageman thats exactly what I wanted to know. My plan is to pay up the mortgage and figure out a way to pay them back the $31K that is owed also.

BeenAround, what I want to know about that loan is:

1) Is it legal to make someone payback a loan that they filed bankruptcy on, in order to do business with them again?

2) I understand I am in default on the loans, and I want to pay what I owe LEGITIMATELY, but I don't want to pay for a loan that I didn't receive any money for and that may infact be illegal. I was desperate at that point and I don't feel that just because I was desperate they can break the law. (If that is the case)

I don't expect to get out of my mortgage or anything else I legitimately owe in this. They are using all the legal angles they can, and I think it is only fair that so do I.

I have a long history with this bank, and I know people say things like this all the time, but they were the reason for my lawsuit 6-yrs ago that caused all of this. Actually it was my fault because I let them close the deal without all of the paperwork in order, but I still am not happy about it.

If you think this is a long and confusing story you should hear the one about the bad business deal/lawsuit. It was unlike anything I could have ever imagined.
 
Ok, sorry, I think I understand better now.

Long time ago, I recall reading something relevant to your situation where after filing for bankruptcy and the debts were discharged, some lendors pressured the guy into signing a paper that said he will still pay back the loan. So now, this guy was stuck paying back the loan again, even though it was discharged. I remember this story because I thought it was so crazy.

I assume you didn't sign anything like that, and this loan document tries to make it look like it was a totally unrelated "business" loan. I think it's shady as hell what they did to you, but I have a feeling you are stuck with this one.
That's because you knew and understood that purpose and the use of this business loan - it was to pay back your discharged debt. And you agreed to it. But I'm not a lawyer, so I hope I'm wrong on this one !

I do wish you a ton of luck though.
 

Doc203

Junior Member
Beenaround, that is exactly what happened. I didn't sign anything out of the ordinary, but I kinda thought that may be the answer.

To be honest about it, I have screwed up quite a bit over the years, I.E. the business deal that I let them close without hardly any paperwork etc and I am just trying to make sure that I cover everything. I want to do things right this time and get my financial life together so I can quit worrying so much all the time.

Thanks a lot for the advice, it is exactly what I was looking for.
 

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