Question about Chapter 13 and my mortgage

[astrosfan]

Ok, I have been trying for over a year and a half to obtain a loan modification with Chase. I am about six months behind on my mortgage, or about 9k. I decided to file bankruptcy about a month ago that would include my mortgage, and obviously other debts that I have.

I just received paperwork this past Friday from Chase that I was approved for my modification, which lowered my monthly payment along with my interest rate. My monthly note went from $1470 down to $1133. My interest rate was also dropped from 6% to 4.5%

I would like to accept the modification, but I will still be filing for Chapter 13 within a month.

I know that all creditors will be advised that I'm filing for bankruptcy, but I would like to keep my mortgage separate from the monthly payment.

Is this something I can do? Will Chase still accept my modification if I file Chapter 13?

[Flamingo]

Since the modification would change your financial situation, if you have not yet consulted with an attorney as to filing your Chapter 13, now is the time to do so.

[astrosfan]

I have already made my 1k deposit about a month ago. I'm supposed to sign the papers tomorrow and the notices will then be sent to the creditors. My attorney called me today and advised me that it's no problem to pay my mortgage outside of my Chapter 13.

I guess my biggest worry would be something happening with my loan modification. I'm very happy with what Chase offered and I don't want that messed up because of my filing.

[lrprn]

I guess my biggest worry would be something happening with my loan modification. I'm very happy with what Chase offered and I don't want that messed up because of my filing.

It isn't clear from your posts whether you've informed your attorney about the modification yet. If you haven't, you need to do so immediately before your Ch 13 is filed. The modification could change the disposable income showing on the Means Test and Schedules. If you haven't discussed the modification yet with your lawyer, please do so asap and certainly do so before signing a modification contract provided by your mortgage company.

By the way, once you file bk, regardless of who makes your mortage payments, since your home is a secured asset, the home and its loan(s) are still included as a part of your Ch 13 plan and so will be under the control of your trustee. Nothing can be done with the home financially without the prior permission of your trustee. If your lawyer okays doing the modification, you need to sign the mod contract before you file or the trustee will have to approve it and that could take awhile.

[Pandora]

I am about six months behind on my mortgage, or about 9k.

I just received paperwork this past Friday from Chase that I was approved for my modification, which lowered my monthly payment along with my interest rate. My monthly note went from $1470 down to $1133. My interest rate was also dropped from 6% to 4.5%

I would like to accept the modification, but I will still be filing for Chapter 13 within a month.

First thing you need to look at is your mod offer - is it fixed for the life of the loan or does it waterfall? If it waterfalls and re-sets at XX year and XX % - then you need to consider that before you enter into any agreement and/or Ch. 13 filing. You will be locked into your 13 for 3-5 years... can you afford that as well as the increase if your mod isnt fixed?

The other issue then becomes your arrears... how is your lender dealing with those? Did they put them on the back end of the loan? Did it become a balloon payment? When you file CH. 13 you must be able to pay your plan payment, which will include any arrears as well as your regular mortgage payment and any other creditors (secured / unsecured) you have.

Go over everything very carefully before you sign and/or file Ch. 13

[astrosfan]

No, my modification is a fixed rate of 4.5% for 20 years. My loan was at 6% and would have been paid off in 2022, but now it will be 2032. There is no balloon payment.

My attorney has advised me that it's no problem to pay my mortgage outside of my chapter 13.

[astrosfan]

I'm really wondering what the monthly payment will be. My attorney stated that if I didn't have my "extra job" that I work that I would qualify for chapter 7. I've had this side job for 15 years and the extra $1500 a month comes in handy.