WHY CAN'T I DISCHARGE A MORTGAGE OR A CAR LOAN?
Both mortgages and car loans contain TWO agreements. (They may be incorporated into one document.) The first is a Promissory Note. A bank (or other lender) gives you money. By signing the promissory note, you promise to pay it back. This note is essentially an unsecured debt. If you do not pay it back, you can be sued.
Because these loans typically involve significant amounts of money, the lenders want security. This security comes from a mortgage on real property, or the lender's name on the title of a vehicle. If you do not pay the loan, the lender can seize the property.
Repossessing a vehicle is relatively easy. The lender just sends someone to take it. (If you are behind on your car payments, do not leave personal property in the car!)
The process of "seizing" a house is more difficult and is called a foreclosure. In California, the security agreement is technically known as a "Deed of Trust," not a mortgage. (However, it is still commonly referred to as a "Mortgage.")
Foreclosing on a "Deed of Trust" does not require court action. However, it is subject to rigorous procedures: Default Notices, Sale Notices, Recordings and Publication must be done properly. Taking someone's home is considered much more serious than repossessing a car.
IMPORTANT:
A "Deed of Trust" is NOT a "Deed." A "Deed of Trust" is an agreement that secures a loan. (It is also a written document, but still basically an agreement.) A "Deed" is a document that transfers ownership. A "Deed" is not an agreement. One can only guess at the motives of the persons who created such similar names for such different documents.
See Statute of Liberty
