Obama Mortgage Modification plan and Congressional Bill to allow judges to modify

[njguy1972]

I saw an article that the Senate did not pass the bill to allow bankruptcy judges to modify mortgages.

http://www.nytimes.com/2008/04/04/business/04housing.html?_r=1

For the Obama Plan (Making Home Affordable) you need to go through your mortgage company.

http://makinghomeaffordable.gov/

I personally qualify for this plan. I have 2 years left on an ARM that I would like to stabilize for the next 5 years as I prepare to file. The Mortgage Company (Wells Fargo) told me they would contact me if they believe I qualify.

https://www.wellsfargo.com/mortgage/account/stabilityplan

Has anyone been successful with this?
Would it be a big deal to modify the mortgage after I start my Chapter 13? I believe you need trustee permission for it. I cannot imagine the trustee saying no if it makes the debtor's situation better.

Any thoughts by anyone?

This is the last thing I am waiting to settle before filing.

[summer64]

The article you quoted was from 2008. There was a bill before the Senate that was not passed last year. A similar bill is now before the Senate again, although it's passage is far from guaranteed. The Senate is expected to either take a vote or table it as soon as they return from recess next week. It's got more steam and support than last years version, but still plenty of opposition with the banks lobbying hard against it. In all likelihood, there will be a provision where the person needs to request a modification from the bank first prior to being able to cram in BK. The ability to cram in BK will make many more lenders willing to work with folks who want to modify and are considering BK, though. I am personally waiting for the outcome of this bill before officially filing my 13. My attorney indicated that it's very tough to get your mortgage modified after filing your 13, but not because the trustee will object. Mainly because as part of a CH13 filing you can roll in any back mortgage payments, but must stay current on your monthly payments if they are paid outside of the plan (which is rare if you are including back payments in the plan). Once this happens, if the morgage company wasn't willing to work with you before the 13 when they are unlikely to do so after when they know you have to stay current on your payments or any stay is lifted. If Wells Fargo is willing to work with you before you file, that's probably your best bet, although you need to speak with your attorney. If they aren't then hopefully S.61 will pass, at the very least there should be some update on the status of this bill next week...supposedly they are trying to work out a compromise this week.

[Jacinta]

I also believe I qualify for the Obama refi. I had given up on Wells Fargo offering it and made an appt for tomorrow to see an atty. But on the way home from work I called Wells Fargo. They said someone would call back in 5-7 working days and it is now being offered. So I just got all of my paperwork together and am still going to the free consult with the atty in the morning.

[njguy1972]

here is the link to the Senate bill that I thought was rejected but will be taken up later this month.

http://thomas.loc.gov/cgi-bin/bdquery/z?d111:H.R.1106:

It discusses that the bankruptcy court can modify mortgages similar to the Obama Mortgage Modification Plan.

It looks like they want you to go to your mortgage company first. If your mortgage company is unwilling to modify and you are facing a ch 13, the court can force them to modify according to the plan.

[summer64]

That is the bill as it is written now. The requirement to request a modification from the mortgage company was written in when the house passed their version in early March. The Senate version of the bill is at great risk of never making it to a vote in the Senate due to lobbying from the banking industry which has caused quite a few moderate democrats to oppose passage. Essentially, if a compromise isn't reached while the Congress is on recess the cram down language is likely to be removed from the housing package. I'd encourage everyone to call and email their Senators THIS week urging them to support this bill. There is a very good chance this bill will not even make it to a vote without pressure from the American voters.

[floridian]

anyone heard of any more bk laws under consideration?