Ch 13 BK and modification

[desjardin]

I had been trying to get a loan modification on my first with Aurora Loan Services since Feb. 09 - denied once in May 09 because they felt we could afford our loan, tried it again with revised financials - got the run around, went to a credit counseling agency for help - no luck there. We had been making all of our payments on time so I'm sure that had to do with the general run around and now we've decided to file Ch 13 BK. We stopped making payments on our 1st and 2nd mortgage + credit cards, etc. I just received my notice of default from Aurora and we are going to file the BK in a few weeks (mid Oct).

My question is: should I try to work on the loan mod process prior to filing the BK (mortgages will be included in the BK) - or should I wait until after I file? I have been reading some of the stories saying that Aurora may not work with me after I have filed and since it is Ch 13 it won't get discharged for 5 years. Our lawyer is going to try and strip down the 2nd as our home value may allow for it so not sure if that piece of information is going to be crucial in Aurora's modification calculations. My lawyer had advised us not to talk with the mortgage companies until we file but just not sure what I'm really doing. We let the mortgage go into default to get their attention but the catch 22 is that once we file BK then they may not talk to us? I'm also considering hiring a lawyer for the modification this time around. Wondering if I should contact them now or after I file BK? Also, looking for a good recommendation (Calfornia).

Any help or advise is greatly appreciated.
Thanks!

[Evan Bedard]

Hi desjardin welcome and thank you for joining.

My question is: should I try to work on the loan mod process prior to filing the BK (mortgages will be included in the BK) - or should I wait until after I file? I have been reading some of the stories saying that Aurora may not work with me after I have filed and since it is Ch 13 it won't get discharged for 5 years. Our lawyer is going to try and strip down the 2nd as our home value may allow for it so not sure if that piece of information is going to be crucial in Aurora's modification calculations. My lawyer had advised us not to talk with the mortgage companies until we file but just not sure what I'm really doing. We let the mortgage go into default to get their attention but the catch 22 is that once we file BK then they may not talk to us? I'm also considering hiring a lawyer for the modification this time around. Wondering if I should contact them now or after I file BK? Also, looking for a good recommendation (Calfornia).

I would suggest to give the Law Office of Fransen and Molinaro a call. They are loan modification specialists and can also advise you on your bankruptcy questions as well:

Law Office of Fransen and Molinaro at (888)756-2652

[auroraproblem]

Originally Posted by desjardin

I had been trying to get a loan modification on my first with Aurora Loan Services since Feb. 09 - denied once in May 09 because they felt we could afford our loan, tried it again with revised financials - got the run around, went to a credit counseling agency for help - no luck there. We had been making all of our payments on time so I'm sure that had to do with the general run around and now we've decided to file Ch 13 BK. We stopped making payments on our 1st and 2nd mortgage + credit cards, etc. I just received my notice of default from Aurora and we are going to file the BK in a few weeks (mid Oct).

My question is: should I try to work on the loan mod process prior to filing the BK (mortgages will be included in the BK) - or should I wait until after I file? I have been reading some of the stories saying that Aurora may not work with me after I have filed and since it is Ch 13 it won't get discharged for 5 years. Our lawyer is going to try and strip down the 2nd as our home value may allow for it so not sure if that piece of information is going to be crucial in Aurora's modification calculations. My lawyer had advised us not to talk with the mortgage companies until we file but just not sure what I'm really doing. We let the mortgage go into default to get their attention but the catch 22 is that once we file BK then they may not talk to us? I'm also considering hiring a lawyer for the modification this time around. Wondering if I should contact them now or after I file BK? Also, looking for a good recommendation (Calfornia).

Any help or advise is greatly appreciated.
Thanks!

Our BK attorney was very clear about waiting until after the mod to file Ch 13. We are in Washington state. When I talked with Aurora, they too had stated that a BK filing would screw up my loan mod (they did not disclose much for details as to why).

Like stated already, an attorney should know, if not then you should get another one or best yet call the one that Moe recommended.

[auroraproblem]

Sorry for the second post. Also what should be noted is that in my dealings with the second, BK is your trump card. If you already file, they hold the cards then. If you do not, there is always the chance that you will file against any judgement they were to get and you may file and not reaffirm the house (thus walking away without paying anyone). Since they are unlikely to foreclose from second position (if you are under the first loan balance vs. value). A good lawyer should be able to clear this right up, though most of this information is posted on this website in one form or another.