quick question: repayment after loan mod

[sacredgroove]

We have not filed our 13 yet, and still in the running for a loan mod on the mortgage. Had attorney meeting and proposed repayment was 0% to unsecureds. If our mortgage payment is reduced by the loan mod, I would think the trustee would just take the extra and give it to the unsecureds as opposed to it just going into our pocket. Is that a pretty fair guess?

current proposed plan would be according to attorney:

wife only filing w/50k in unsecureds in her name
2100 mortgage
203 arrears on mortgage
45 attorney
177 trustee

If the bank reduced our mortgage $300 or so, is it a good possibility that $300 would then just go to unsecureds (this would be modified prior to filing the 13)

Thanks!

[momofthree]

It could be more than that because you also would no longer need to pay arrears into your plan, and could most likely pay the mortgage outside of the plan, lowering trustee fees as well.

It would probably look more like:

mortgage: $1800 (outside of plan)
arrears: $0
unsecureds: $610-ish (savings from mortgage, no arrears, savings on trustee fee)
attorney: $45
trustee: $65-ish
=$720-ish unless you can also raise your other expenses to offset the difference...

[SMinGA]

Overall, probably you are right. But from the way most mods work your rate would be permanently reduced so you'd be better off down the road. (After ch. 13.)

[momofthree]

Overall, probably you are right. But from the way most mods work your rate would be permanently reduced so you'd be better off down the road. (After ch. 13.)

I agree, don't lose sight of the big picture here. The mod will save you money for the next 30 years or so. Bk is only 5 years, and you end up with the same goal in the end...getting out of debt in 5 years time.