chapter 13 and modification - Loan Modification Forum

mintdeer · 09-29-2009, 11:52 AM

Does anyone know if you can still get a new loan modification while in or after filing a chapter 13 bankruptcy? I have been trying to get a mod since March and a lot of our credit card debt is now behind, I can't sell our cars as we are upside down on them as well as our home,I could get a good portion of my 2nd mortgage stripped as our home is worth less than we owe on our first mortgage, and financially it seems a good idea. The only problem I have is that our 1st mortgage is a interest only ARM that will adjust in 2 years so I am afraid that I will be dealing with a new problem if I don't try to get a mod now. The only peace I would have is that at least I could make my payments again for the next two years but then what? Any ideas?? Can ARMS adjust while you are in bankruptcy?

PCBFL · 09-29-2009, 12:05 PM

We filed a chapter 7 this year and Wachovia and Wells Fargo both told us while in active bankruptcy they would not look at a modification for us. They told us we had to reaffirm the loan, be discharged and then apply for a mod. We are upside down and have an ARM that adjusts in February on our 1st that if adjusted today would be about $400 more a month due to converting from an IO to P&I. We opted not to reaffirm if they were not willing to help during BK. I understand it is the same in a 13 because the trustee cannot establish the repayment plan of the debts without knowing what the mortgage payment will be. If they do a mod and reduce the payment then the trustee has to take more of the whats left for the debts....it is all math and a percentage of your income. I am not an attorney and no legal advice here. You should talk to a couple BK attorneys and explore your options. Be sure to consult with at least 2, we did and were so happy with our 2nd attorney over the 1st one we spoke to, most offer a free consultation.

BobandArlyn · 09-29-2009, 12:41 PM

Mintdeer,

We filed Chapter 13 BEFORE going for the mod. Not a problem. Although we haven't received the Trial Payment package yet which was approved on 9/18. Should be here by 9/24, now 10/2.......we'll see.

Good question about ARM adjusting while in bankruptcy....I would like to hear that answer. Anyone???

09-29-2009, 11:52 AM	#1 (permalink)
mintdeer Senior Member Join Date: Sep 2009 Posts: 102 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	chapter 13 and modification Does anyone know if you can still get a new loan modification while in or after filing a chapter 13 bankruptcy? I have been trying to get a mod since March and a lot of our credit card debt is now behind, I can't sell our cars as we are upside down on them as well as our home,I could get a good portion of my 2nd mortgage stripped as our home is worth less than we owe on our first mortgage, and financially it seems a good idea. The only problem I have is that our 1st mortgage is a interest only ARM that will adjust in 2 years so I am afraid that I will be dealing with a new problem if I don't try to get a mod now. The only peace I would have is that at least I could make my payments again for the next two years but then what? Any ideas?? Can ARMS adjust while you are in bankruptcy?

09-29-2009, 12:05 PM	#2 (permalink)
PCBFL Member Join Date: Aug 2009 Posts: 17 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: chapter 13 and modification We filed a chapter 7 this year and Wachovia and Wells Fargo both told us while in active bankruptcy they would not look at a modification for us. They told us we had to reaffirm the loan, be discharged and then apply for a mod. We are upside down and have an ARM that adjusts in February on our 1st that if adjusted today would be about $400 more a month due to converting from an IO to P&I. We opted not to reaffirm if they were not willing to help during BK. I understand it is the same in a 13 because the trustee cannot establish the repayment plan of the debts without knowing what the mortgage payment will be. If they do a mod and reduce the payment then the trustee has to take more of the whats left for the debts....it is all math and a percentage of your income. I am not an attorney and no legal advice here. You should talk to a couple BK attorneys and explore your options. Be sure to consult with at least 2, we did and were so happy with our 2nd attorney over the 1st one we spoke to, most offer a free consultation.

09-29-2009, 12:41 PM	#3 (permalink)
BobandArlyn Senior Member Join Date: Sep 2009 Location: Santa Rosa, CA Posts: 374 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: chapter 13 and modification Mintdeer, We filed Chapter 13 BEFORE going for the mod. Not a problem. Although we haven't received the Trial Payment package yet which was approved on 9/18. Should be here by 9/24, now 10/2.......we'll see. Good question about ARM adjusting while in bankruptcy....I would like to hear that answer. Anyone???

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