Converted to a chapter 7

[Gunterwoman]

Good morning everybody,
In June of 2020 I filed a chapter 13 in NV, in September of 2022 I converted my chapter 13 to a chapter 7. We had our 341 on oct 21, 2022, which was a no asset case. On October 22nd the Trustee enter a No Distribution report with property abandoned. From what I have been reading this sounds like a good thing. At no time did I reaffirm our mortgage, is this a good thing or a bad thing? We have been paying our mortgage outside of our bankruptcy during the entire case, however we are behind on some payments but trying to come current y house payment is over half of my monthly retirement income, so it’s been a struggle to keep up with the astronomical power bills, keeping food in the pantry, gas in the car, and basically live day to day. I’m terrified of becoming homeless. Should we have reaffirmed our home? Thank you for reading and any insight you can provide.

[justbroke]

It is never a good idea to reaffirm any property, period. Reaffirmation would likely have required you to be current on your mortgage. In retrospect, not being current on your mortgage and converting can cause serious issues. You will need to work with your lender to determine the path forward. They may do any of several things which include, but is not limited to, a modification. Personally, I would not have converted if I were behind in mortgage payments simply because that puts you in a very bad spot (because only a Chapter 13 can force the lender to take a slow payback).

Bottom line: reaffirmation would not have (necessarily) saved your home. That would have only set you up for being 100% responsible for any foreclosure and deficiency from a foreclosure sale.

You really need to work with your lender and determine what they want to do BEFORE your case is discharged. After discharge, they are no longer bound by the automatic stay and could possibly proceed to take legal action(s) which may include foreclosure.