Adjustable rate mortgage question

[DYLAN150]

How does an adjustable rate mortgage work in a chapter 13?

[jade73]

How does an adjustable rate mortgage work in a chapter 13?

The rate will still adjust. Our mortgage company just sent us one, the rate went down, Thank God! Actually the mortgage company sent it to our Lawyer and they forwarded it to us.

[indebt00]

I have wondered about this myself because ours adjusts every 6 mos and if the economy recovers the % rates will rise and so will our mortgage payment...but for now it has gone down. If it goes up in a couple years it could be hard to manage our costs....each adjustment is about $100 payment difference.

[justbroke]

How does an adjustable rate mortgage work in a chapter 13?

Generally speaking, rate adjustments on mortgage payments are sent by notice to the Debtor (or Debtor's attorney) and the Trustee. By virtue of a clause in the Order of Confirmation, the Trustee is allowed to adjust the Chapter 13 Plan payment without Order if it's to deal with an adjustable rate mortgage (ARM).

So, when the adjustment comes, the Trustee just files a Notice that the Plan payment has changed and what the new Plan payment is. Yes, I just went through this myself.

[brokeinfl]

Generally speaking, rate adjustments on mortgage payments are sent by notice to the Debtor (or Debtor's attorney) and the Trustee. By virtue of a clause in the Order of Confirmation, the Trustee is allowed to adjust the Chapter 13 Plan payment without Order if it's to deal with an adjustable rate mortgage (ARM).

So, when the adjustment comes, the Trustee just files a Notice that the Plan payment has changed and what the new Plan payment is. Yes, I just went through this myself.

So if the MTG is not included in bankruptcy, you're SOL? The interest on my HELOC will surely go up in the near future.

[justbroke]

Basically, yes. Unless you lien stripped the 2nd, you MUST pay the second or surrender the entire home, in a Chapter 13.