Modifications in a 13

[cc8225]

When is it best to work with the 1st on a loan modification? I am reaffirming the first in a 13 when I file on Dec 21. We are lien stripping mortg 2 and 3. I have missed November's payment on my first mortgage (1st time late). Should i call to negotiate a modification before or after a file?

Thanks

[debtinohio]

Before. They won't talk to you in bankruptcy.

I'm delaying my filing right now waiting on a mod approval on a rental property the wife wants to keep.

[Itsbel62]

Before. They won't talk to you in bankruptcy.

I'm delaying my filing right now waiting on a mod approval on a rental property the wife wants to keep.

our mortgage was modified for a year and will reset this coming march. if they won't talk to us while in chapt. 13, what will happen? we can't afford the original mort. amount. thanks.

[justbroke]

Before. They won't talk to you in bankruptcy.

This seems to be lender specific.

I actually just talked to the Modification department with my servicer. I called about a modification under HAMP. They knew I was in bankruptcy because my mortgage is flagged as such. They stated that they don't do modifications for HAMP while you are in active Bankruptcy (I'm in Chapter 13). However, she immediately stated that they'd do a modification under their own program while I'm in active Bankruptcy. The first thing they had to do was to send out a form to my attorney (which I'm pro se, so it's actually me) to permit them to "talk" to me during the automatic stay.

I have the rest of the package ready for modification, just awaiting the "form" that I have to complete (as the attorney of record) to get the modification rolling.

debtinohio is right to encourage you to get the modification before entering into bankruptcy. This did in fact stop my modification that I had earlier (before filing). However, the bank(s) seems more inclined to do these for active bankruptcies.

[daytona]

Justbroke....I think you are right that it is lender specific (this does not seem to apply to your case as it doesn't sound like you have already started a HAMP Trial)....just trying to post some addnl material for others.

If someone were already in a HAMP trial Mod, then the lender is supposed to work with the Bk attorney to basically continue the process to modify under HAMP as though one were not even in BK.

[Itsbel62]

Thanks for the good info!

[daytona]

If you want to read about it check out this link.... http://www.consumerlaw.org/issues/mo...ations0709.pdf To be clear these are percived weakness's along with clarification of some of the guidelines.

There are more specifics in the longer "official" HAMP documents...

[cc8225]

yes, thanks...

[daytona]

Here u go from the official HAMP site...look at Q22 at bottom of page 6.

https://www.hmpadmin.com/portal/docs/hamp_servicer/hampfaqs.pdf

[yomann]

debtinohio is right to encourage you to get the modification before entering into bankruptcy. This did in fact stop my modification that I had earlier (before filing). However, the bank(s) seems more inclined to do these for active bankruptcies.

If one is forced into filing BK13 (lawsuit filed by unsecured creditor), while waiting for an outcome of a pending loan modification, what happens then ....... ?
An attorney stated I will have to agree to make the original mortgage payments to the bank, and re-start the loan mod process all over again !
Heck, the reason for asking for a mod was my inability to make the original loan payment in the first place !
Seems like a Catch-22
Any suggestions for a newbie to this forum ?
TIA

[justbroke]

If one is forced into filing BK13 (lawsuit filed by unsecured creditor), while waiting for an outcome of a pending loan modification, what happens then ....... ?

This depends. Under HAMP, the lenders/servicers are encouraged to continue the modification process.

An attorney stated I will have to agree to make the original mortgage payments to the bank, and re-start the loan mod process all over again !

This is true under most lender/servicer modifications that are not under HAMP, filing stops the process. This is exactly what happened to me. Then your Chapter 13 would need to propose the "original" payment unless and until you receive your modification.

Again, HAMP rules are different, and encourage the lender to continue the process notwithstanding the filing of a Bankruptcy.

[yomann]

This depends. Under HAMP, the lenders/servicers are encouraged to continue the modification process................
..................Again, HAMP rules are different, and encourage the lender to continue the process notwithstanding the filing of a Bankruptcy.

Thanks for your quick reply.
So, while I am presently under consideration for a HAMP mod since Sept.09 (and not making any payments for 5 months), will those conditions continue upon filing BK13 ?
Upon reaffirming the 1st mortgage, can I continue with zero payments, until a HAMP mod has been granted and accepted ?
Is any of this subject to attorney negotiations with the trustee, or are the rules cut & dried ?

[justbroke]

So, while I am presently under consideration for a HAMP mod since Sept. 09 (and not making any payments for 5 months), will those conditions continue upon filing BK13 ?

Yes, but they are not "contractual" and is probably why your attorney (correctly) states that you must propose the payment according to your "contract".

Upon reaffirming the 1st mortgage, can I continue with zero payments, until a HAMP mod has been granted and accepted? Is any of this subject to attorney negotiations with the trustee, or are the rules cut & dried ?

Let's not talk about reaffirmations in a Chapter 13 context, because that really doesn't exist.

This is where it gets murky. I would follow your attorney's lead on this. You would NOT be able to continue making $0 payments. You would need to provide -- at least -- adequate protection, which is going to be close to your mortgage amount anyhow. (I don't get into adequate protection but suffice it to say that a secured lender must have some protection against further depreciation of the property.)

Chapter 13 plans are interesting and I think this becomes problematic because the lender is entitled to payment in order for your Plan to get confirmed. What that payment is, is undefined at this point because it appears you're still playing around with getting an actual HAMP modification. Perhaps your lawyer can work with the lender to step up the HAMP modification so that a feasible plan can be proposed.

[yomann]

..............This is where it gets murky. I would follow your attorney's lead on this. You would NOT be able to continue making $0 payments. You would need to provide -- at least -- adequate protection, which is going to be close to your mortgage amount anyhow. (I don't get into adequate protection but suffice it to say that a secured lender must have some protection against further depreciation of the property.)...................

justbroke - TOA !
My 5 yr ARM was interest only, at $1,300/mth.
In August '09 it reset to principal + interest, at $1,850/mth.
This was about the time I had to shut down my small business.
Do you think it may be possible for my attorney to negotiate an interest only mortgage payment of $1,300/mth, while the HAMP mod is under review ?
My concern with agreeing to pay the "full" $1,850/mth while waiting for a HAMP mod is that process can go on for another 6-9 months
BTW; a good forum for Loan Mods is: http://www.loansafe.org/
I got a referral from there to check this site.

[justbroke]

justbroke - TOA !

I don't know what TOA means, but I guess it's a thank you. So, you're welcome.

Do you think it may be possible for my attorney to negotiate an interest only mortgage payment of $1,300/mth, while the HAMP mod is under review ?

If your attorney did this, I'd probably think that the lender would want to do it under HAMP, since they can get "incentive" payments for making the modifications!

My concern with agreeing to pay the "full" $1,850/mth while waiting for a HAMP mod is that process can go on for another 6-9 months

I definitely understand. I think that your lawyer should use the bankruptcy to leverage the lender to proceed quicker with the HAMP modification so that the Plan gets confirmed the right way. That's just me.