Consumer complaint received 2020-09-11
Company: CIT BANK, NATIONAL ASSOCIATION
State: CA
Product: Debt collection
Sub-product: Mortgage debt
Issue: Attempts to collect debt not owed
Sub-issue: Debt was already discharged in bankruptcy and is no longer owed

Complaint:
XX/XX/XXXX : My wife and I filed for Chapter XXXX Bankruptcy. 

XX/XX/XXXX : All debts were Discharged, including the debt to IndyMac. 


XX/XX/XXXX IndyMac issued me a XXXX for the cancelled debt amount and I reported it on my taxes for XXXX. 

XX/XX/XXXX : We tried to refinance our home when the title company informed us there was a lien on the property from IndyMac / XXXX  XXXX  XXXX, who was now acquired by CIT Bank. We had no idea there was still a lien on our property, as we believed the lien was removed once the debt was cancelled. 

XX/XX/XXXX : I contacted CIT XXXX XXXX, and requested a lien release. In my email message I informed them of the Bankruptcy Discharge that included the cancelled debt from IndyMac. I also attached copies of my BK Discharge and XXXX from XXXX that was issued to me from IndyMac Bank. 

XX/XX/XXXX : XXXX XXXX from CIT responded stating 'We show this debt was discharged in the bankruptcy. The discharge didn't require the bank to release the lien. We are prohibited from any collection effort, but the lien remains valid. We can provide you a payoff quote if requested. We also will review any voluntary settlement offer submitted for less than the principal balance for the lien release. ' I responded the same day stating 'I am not sure I understand. If you are prohibited from collecting on the debt, then why are you trying to collect through a 'payoff quote ' related to the same debt that was discharged? ' XX/XX/XXXX : I received an email from XXXX XXXX with CIT Bank stating 'Please find attached a letter ( and payoff statement ) in response to your inquiry with the XXXX XXXX XXXX ( XXXX  ) and emails to CIT Bank regarding your loan. ' The payoff quote stated my old Loan number, with 'Total due to pay off loan ' in the amount of {$110000.00}. The same amount that was discharged in the bankruptcy. The letter appeared suspicious and unprofessional, written on a Word document with wiring instructions to a XXXX XXXX Bank Account. 

XX/XX/XXXX : I tried to contact my Bankruptcy Attorney and discovered that she no longer practiced in bankruptcy 's. I spent weeks trying to find BK attorneys that might be able to help me resolve my issue, but I could not afford their services. 

After further review of my bankruptcy discharge documents. I found a disclosure statement stating : Collection of Discharged Debts Prohibited The discharge prohibits any attempt to collect from the debtor debt that has been discharged. For example, a creditor is not permitted to contact a discharged debtor by mail, phone or otherwise to take any other action to collect a discharged debt from the debtor.

CIT Bank is now clearly trying to collect on the debt that was discharged and provided me a written letter stating their intention to do so. An action they are prohibited from doing. Even though their representative stated they were not trying to collect the discharged debt. They are simply rewording the collection attempt by calling it a payoff quote. Since I was issued a XXXX, that would imply the bank wrote off the debt back in XXXX. At this time, CIT Bank has no reason to continue to hold title to my home. I am requesting the lien against my home to be released and reconvey title back to me and my wife, at no charge. 


Please contact me for any further information. 
Thank you.

Company response to consumer: Closed with explanation