Help!!!!

[dani]

We're in such a mess.
I'll make this as brief (grrr...) as possible ---
Filed Ch.13, judge wanted nothing to do with "second" properties, sooo,
it was "surrendered" from the Ch. 13 plan. This property is out-of-state,
first mortgage was, has been, and is current along with taxes, etc. The equity loan (with the same bank) was not paid on attorney advice to try to "strip" lien. Obviously unsuccessful!!!
We have since resumed the payments (which are accepted and applied to the loan).
Our problem isn't the "mortgage" its legal fees. The bank wants all its fees reimbursed, (hefty...) we're willing to pay them. They wanted repayment in 30 days, we spoke to bank VP, for a possible extension - NO!! Their attorneys won't speak to us. We had to retain an attorney on our behave.
They asked for the arrears and a payment plan from us. Upon sending a Cashier's Check and requesting up to 6 months, they returned the check and stated they were proceeding with a foreclosure.
On advice of counsel, we "should" retain an attorney in-state where the property is. Having done that, upping more attorney fees on both ends, and on the verge of a yet another possible settlement --- they then wanted the bankruptcy court to reinstate the property (which supposedly ain't gonna happen...) foreclosure proceedings have been filed.
Obviously, (grrrr.......) they can do this!
But, we're current on payments, they continue accepting payments, we are not disputing the fees, want to repay.
Why are they doing this ????????????????

[Mi Bankruptcy]

Why were you paying on it if you let it go in the BK? It would seem to me if you let it go and the fees were attached to this property then those could be wiped out. I would also ask for a debt validation from their attorney to see what fees they are trying to charge you for.

[dani]

Re: Help!!

Thanks for ur answer,
we kept paying on it because it's a property we do not want to lose.
Our attorney, knew that, thought he would try to put it in the plan; but did advise us, that if it wasn't in the Ch.13, in the end we "could; work it out with the bank.
It is our understanding that if legal fees are incurred, and it is not in a bk plan, they can collect.
Problem is, this bank is pulling all the stops NOT to settle.

[NoTomatoCan]

What do you mean by "judge wanted nothing to do with second properties?"

Is this an income property? How were you accounting for the property in your plan? Was it originally in the plan and you changed it to surrender it?

[dani]

Re: Help!!

The "second home" was initially included by our attorneys in the plan.
It is rented, pays for itself, and is a "vacation home", when vacant.
The judge - trustee whatever, would not approve anything in the plan "that was not essential". Therefore, whether it paid for itself or not, a second property would not be approved - therefore, "surrendering" it through BK court.
But, again, according to our attorney, (and he says he sees this alot) if payments are made, if bank will work it out, it's not a problem to keep it.

If banks would "really" help people, like the government helped them, many of these problems could so easily be resolved.

Many attorneys we've talked to all say, banks DO NOT WANT to help people, all they want is money, they don't care how they get it, what it takes to get it.

[NoTomatoCan]

What part of Michigan are you in? How frequently was the house rented prior to your filing? I am in Michigan as well, and am keeping a rental that is only mildly cash flow positive... but over the life of the plan (60 months) will add about $1,500. Not much, but hard for trustee to object to the unsecured creditors getting an additional $1,500.

You mention vacation home, and there is no way that would fly with the trustee. So if the place is only sometimes rented out, and could be perceived as a "drain" on your plan, then most (all) trustees would object.

However, if you had a solid rental history, and the house was cash flow positive (when accounting for all expenses) and therefore it was actually adding funds to your plan, then I do not see why the trustee would object OR why your attorney didn't fight the objection. Your comment about it sometimes being a vacation home leads me to believe that it wasn't always rented. This might be why the trustee objected (and why your attorney did not seem to fight the objection).

The Trustee (not the judge - I know it seems like a trivial difference, but it does matter) can object all they want to. It sort of is their job to object and try to get as much for the creditors as possible. However, if you could prove that the second house was not a drain on the BK estate, than you could have fought the objection (that is where the judge comes in).

[ColoradoBell]

I feel your pain!
I have a similar problem..an investment property that I'd like to keep for its future potential in providing income and a job.
I can see where it might be hard to get the trustee to allow it tho and in my case my X already objected to this payment as being a 'luxury' since I didn't list it as an asset (because, until the property is developed and sales start, it isn't worth more than the loan).
It seems like it might not matter whether the property is in the plan or out of it...in my case, the loan payment is OUT of the plan, listed as a 'necessary' expense and it won't 'produce income' for at least a year.

But it seems your problem is that the bank WANTS that property and is trying to use your filing Bk to take it....or am I confused?

[dani]

Your absolutely right!
It does seem like the bank just wants the property.
Yet payments are now current and they keep accepting them,
Good Luck to you in your situation.

[dani]

Re: NoTomatoCan

Seasonal rental - that's probably why.
Southeastern District. Attorney said "it would be impossible"
What can I say......
I'm just really confused, exhausted, and really fed up.