Mortgage question for a completed Ch13

[helpless]

we filed ch 13 in April 2005 and finished September 2008. Our mortgage was included in the bk. Unfortunately, my husband lost his job and now there is absolutely no way of being able to keep up on the mortgage. I have a choice between mortgage or COBRA and with a child with diabetes, it is a no brainer. Can I walk away from this house like a chapter 7 does? We have never been late on our mortgage even before bankruptcy, but this is scary. Don't know what to do. Any advice? I'm in Ohio and of course by house isn't worth what I owe, there has been so many foreclosures in my area that it has really driven down the house values in my neighborhood. Thanks.

[lrprn]

we filed ch 13 in April 2005 and finished September 2008. Our mortgage was included in the bk. ... Can I walk away from this house like a chapter 7 does?

Did you sign a reaffirmation agreement for your mortgage when you filed Ch 13? (That would be unusual but not unheard of in Ch 13 if your lawyer did not protect your interests well or was incompetent.) Hopefully the answer is no, you didn't sign a reaffirmation agreement.

Unfortunately, my husband lost his job and now there is absolutely no way of being able to keep up on the mortgage.

Given the loss of your husband's income, it's unlikely you could support a Ch 13 plan. However you won't know until you set up 3-4 free initial consultations with experienced bk lawyers in your area.

If you liked your first Ch 13 lawyer, then you can stick with him/her and set up an appointment *now* to discuss your newly changed circumstances and see what the best options are in your truly unfortunate situation.

Keep in mind that you can file a bankruptcy you qualify for at any time, but that getting a *DISCHARGE* from the filing may not be possible depending on the time frame between your first Ch 13 filing date and the date of your next filing (7 or 13).

In a nutshell, the time frames between discharge eligibility are as follows:
- 8 years between 7s. -727(a)(8)
- 2 years between 13s. -1328(f)(2)
- 4 years between a 7 and 13 -1328(f)(1)
- 6 years between a 13 and 7(if under 70% plan). -727(a)(9)

The time is counted from filing to filing — not from first discharge to second filing.

Hang in there, helpless. You are in a tough spot right now. Set up those appointments with your former lawyer or new lawyers if you didn't like lawyer #1 to find out what's going to work in your situation and what isn't. Good luck and please keep us posted what you find out.

[helpless]

No we didn't sign reaffirmation agreement and it is showing up on our credit report as included in CH 13 bankruptcy 0 balance. I am hoping that we can just walk away because the possibility of selling this house in this market in downtroddened Ohio is hopeless. We will be moving out of state for new job.

[LadyInTheRed]

My understanding is that a mortgage on a primary residence is not discharged in a Chap 13 (assuming you retain the house). The Bankruptcy section of the Federal Court's website says:

Debts not discharged in chapter 13 include certain long term obligations (such as a home mortgage), debts for alimony or child support, certain taxes, debts for most government funded or guaranteed educational loans or benefit overpayments, debts arising from death or personal injury caused by driving while intoxicated or under the influence of drugs, and debts for restitution or a criminal fine included in a sentence on the debtor's conviction of a crime. To the extent that they are not fully paid under the chapter 13 plan, the debtor will still be responsible for these debts after the bankruptcy case has concluded.

http://www.uscourts.gov/FederalCourts/Bankruptcy/BankruptcyBasics/Chapter13.aspx

I found it in the BK Code once, but can't find it now and don't have time to keep looking. I do remember having to go through a maze of cross references to understand that the exclusion from discharge applied to a mortgage. It should be somewhere in Section 1328: http://www.law.cornell.edu/uscode/us...8----000-.html

helpless, it sounds like the bank thinks it's discharged if they show a 0 balance, but I wouldn't want to rely on that.

[jcj112562]

I think the verbiage that is on a Ch13 discharge that applies to a home mortgage is:

IT IS ORDERED THAT:
1. Pursuant to 11 U.S.C. Section 1328(a), the debtor(s) is discharged from all debts provided for by the plan or disallowed under 11 U.S.C. Section 502, except any debt:

a. provided for under 11 U.S.C. Section 1322(b)(5) and on which the last payment is due after the date on which the
final payment under the plan was due;

Since the last mortgage payment is still due after the last Plan payment, it stands to reason that the mortgage is not discharged. Check your Ch13 discharge for words that look suspiciously similiar to those I posted above.

John

[bpokey]

I'm sure the debt is still there and you are or were paying it. You say that your credit report is showing a zero balance though. Was your mortgage sold while you were in bankruptcy? here's why I'm asking. I'm in a 13 myself and I have one (ONE!) payment left. However, about 6 months ago my mortgage was sold and the people who bought the mortgage have reached out to me wanting to settle or work something out. Like everyone else on here, I've had life continue while I was in the 13 and I moved halfway across the country about 3 years into the BK, so I've been renting the house out until the BK is over and I can work out what I'm going to do about it. While in discussions with the new mortgage holders I had mentioned a preference to just, "walk away". They have jumped at the opp and we're now in a holding pattern waiting until the discharge happens and they can swoop in and try to dump the property.

Before anyone asks, no - I don't have any equity in the home, however if I accepted the original settlement offer I could stand to make a few thousand - it's just not worth the hassle though of trying to sell a house when I'm 1000 miles away.

So - all of that back story is to say this. When I was negotiating with this company I expressed a lot of concern over how either a settlement or a walk away would be reported on the credit report and he informed me that they don't report to the credit agencies and so my primary mortgage would appear as sold and paid while I was in the 13 and they wouldn't report anything at all. Is that possible here?