Loan Modification Approved w/ Balloon payment. Covered under BK?

[Maverick]

Hello,

I have a discharged bankruptcy from 2010. I did not reaffirm my home loan. I received documents yesterday for an approved loan modification through HAMP on my 1^st mortgage. The modification agreement states under My Representations that “I was discharged in a Chapter 7 Bankruptcy proceeding subsequent to the execution of the Loan Documents. Based on this representation, Lender agrees that I will not have personal liability on the debt pursuant to this agreement.

The loan modification agreement has a deferred balance of 27K, and a balloon payment of $174k, due at loan maturity, sale or transfer of property, or during a refinance.

My questions are, if I lose my job and get foreclosed on, or decide to walk away from the home in 2-or 15 years, am I responsible for the deferred balance or balloon payment still? I’m clear on the fact that I’m not responsible for the mortgage. But I’m not clear whether or not I’m liable for the balloon or the deferred balance.

Your input is much appreciated. I have 2 more days to sign off on this. I dont want to sign off if im on the hook for these two debts.

Thanks.

[despritfreya]

You discharged the debt through your bk. As stated in the modification documents you will not be personally liable for the debt. This includes any deferred principal that is due upon sale, transfer, refinance or at the end of the loan term. There is no such thing as a "backdoor" reaffirmation agreement. If you eventually walk away, you walk away in full as it relates to the "modified" mortgage.

Des.

[Evan Bedard]

My questions are, if I lose my job and get foreclosed on, or just decide to walk away from the home in 2-or 15 years, am I responsible for the deferred balance or balloon payment still? Can they come after me for the balance owed now? Or does the discharged BK protect me from owing this after a foreclosure?

Welcome and thanks for joining the forum Maverick.

You will not be held liable for any judgements if a foreclosure occurs since the mortgages were discharged in BK, and from my understanding this includes the balloon as well as it is apart of the new mortgage agreement..