Received court papers today

[manyquestion]

Is it normal for mortgage company to sue for lawyer fees and deficiency judgement when you modify chapter 13 plan and include your house that i was going to keep and then decided that I couldn't afford it. They sent court papers today saying they are suing me in court. When I modified plan my lawyer placed a statement in there that any judgement would be unsecured debt. Should I worry about this?

[lrprn]

What exactly did the court papers you received from your mortgage lender say? Are you sure they are suing you, or do the court papers ask the court to lift your automatic stay so your mortgage lender can repossess the house? The first would be a big time violation of your automatic stay. The second is routine and to be expected when you surrender a house in an amended plan after filing.

Have you notified your lawyer you received the court papers from your lender yet?

[manyquestion]

They have already had the automatic stay lifted. They are asking for lawyer fees and a default jugdement.

[AngelinaCatHub]

They have already had the automatic stay lifted. They are asking for lawyer fees and a default jugdement.

As Lrprn stated, this is a major no, no, on their part. They could easily be sanctioned by the bk Judge or perhaps you might even sue them.

It would be interesting to let it go to the civil Judge and once he sees the bk paperwork you have, they may be a bit red faced. Just a thought but I'm sure you don't want the extra stress. 'Hub

[AngelinaCatHub]

Here is just one good article on bk abuse by creditors. It might not apply to you, but it could.

http://www./2008/05/19/new-ammunitio...in-bankruptcy/

[AngelinaCatHub]

Well it seems that the forum software truncates URL's now. I can see a good link then when posted or edited, it changes and becomes dead. What is up I don't know. 'Hub

[manyquestion]

After the stay is lifted arent they allowed to start serving papers? Are they just trying to get a judgement so they can get funds from trustee?

[forgotten]

Well it seems that the forum software truncates URL's now. I can see a good link then when posted or edited, it changes and becomes dead. What is up I don't know. 'Hub

I too noticed you can't use a URL for bankruptcylawnetwork, it converts it to that for some reason.

[michele71]

I thought once the BK court agreed to lift the stay they pretty much have every right to come after you for the money or house and yes lawyer fees too.

[sofarsogood2]

Not true. In the relief of stay given to my mortgage company, they are forbidden to seek any ad personam claims against me. They could go ahead and forclose on the property. They were not allowed to contact me or add any fees to charge to me. All they could do was assert their claim to the house. Our case has been discharged - they haven't even foreclosed yet. Too late for them to get a judgement even if they tried.

[manyquestion]

Our lawyer put a statement in modified plan that any judgement would be unsecured and disbursed by trustee in that manner, so question is do we anything to worry about from letting house go back. Thanks for any replies.

[sofarsogood2]

I don't understand why your attorney would have put that in (the unsecured thingy). But regardess, you can't get blood from a stone. If they can get the judgement in ( and that is very questionable- I don't think they can) the DMI you pay won't change as long as your new housing costs what your mtg. did.

Now if your new rent is much lower, then your payment might be adjusted up if the trustee thinks it's warranted.

Have they actually foreclosed yet?

We were served with "Summary Judgement" papers during our BK, but that just meant they were going to proceed with foreclosure. The Relief of Stay was worded that they could not pursue an ad personam (personal) judgement- only in rem (foeclose and take back title). Hope that' all it is for you too!

OH, and they still haven't foreclosed ( haven't heard anything else about the foreclosure since) and we were discharged in the meantime.

Good Luck!

[manyquestion]

He put that statement in when we modified plan and let house go. Original plan had house paid outside of plan and then we couldn't afford anymore because of cut in pay and decided to let house go.

[michele71]

Sofar I had this happen to me I am in Ch 13 and mortgage paid outside the plan i missed to mortgage payments and they filed to lift the stay and in addition to the missed payments I paid attorney fees in order to have the stay remain in place. I didnt know where they thought i was gonna get the extra money to pay these lawyer fees but if I wouldnt have paid then they would have started foreclosure proceedings.

[sofarsogood2]

Sofar I had this happen to me I am in Ch 13 and mortgage paid outside the plan i missed to mortgage payments and they filed to lift the stay and in addition to the missed payments I paid attorney fees in order to have the stay remain in place. I didnt know where they thought i was gonna get the extra money to pay these lawyer fees but if I wouldnt have paid then they would have started foreclosure proceedings.

Yes. At any time you do not protect the lein by making payments, they can move towards foreclosure by first lifting the stay. After the foreclosure, they can get the deficiency rolled into your BK plan as an unsecured debt. But if you are already paying max. DMI- who cares. Your payment stays the same, just other unsecureds now have to share the payment with MTG. company. No skin off your nose.