Do you have to be current on mortgages for ch7 if planning to stay in home.

[BKMarty]

Hi everyone just wanted to get some feedback. I will be filing for ch 7 very shortly and wanted to know if I would have to stay current on my mortgages to file for ch 7. I owe 650K on 1st and 290K on 2nd. The house is worth around 650K and droping by the minute was 1.2 mill in 2007. I want to keep the house and I am working on a loan mod on the 1st was 90 days late but got put on 3 payment trial and just made my 1st payment. The 2nd was 6 months behind but they drooped my payment in half to $483 for 4 years but no balance reduction. I did make my my good faith payment on the 2nd and they waived the 6 months of payments I owed them. If the second is not secured by home do I have to stay current when I file. After the discharge I plan to stop payments on the second and hopefully negotiate with them a lump sum for pennies on the dollars to release the lien at a later date. Can not do a lien strip with ch 13 dont qualify to much unsecured and secured debt. Thank you for your help. This site rocks!!!!

[teacher]

That amount of house boggles my mind......wow.

I guess I just don't get why you are trying to keep a house that's so expensive.....but then again you could live in one of those areas where that's a run of the mill 3 bedroom small house that would sell for $200k here, who knows.

[kw1025]

Stay current if you want to keep the house

[aces67]

You need to stay current if you want to keep it.

[albacore44]

You must live in my neighborhood. house appraised $900k 2007. Just received notice of reduction in tax assesment for 2009-2010, assesed value $420K.

[BKMarty]

That amount of house boggles my mind......wow.

I guess I just don't get why you are trying to keep a house that's so expensive.....but then again you could live in one of those areas where that's a run of the mill 3 bedroom small house that would sell for $200k here, who knows.

Actually its a very nice 6000sq ft home in florida and we put tons of money into it and if I can negotiate with the banks and do a loan mod that will keep my payments in the low 3000 range it will be very worth it. Just need to get rid of the lien on the second mortgage.

[ska]

You seem to have a unique situation. Like the others said, it is best to stay current if you want to keep you home after a chapter 7. I am in a chapter 7 and want to keep my home. When I filed I was a little over one payment behind (one payment, plus about 1/4 of another). Everything seemed fine until the next months payment (June) took two weeks to clear, which pushed it to the 1st of the next month. So, then I received a notice of the mortgage company requesting a "release of automatic stay." They proceeded to say that I missed the June and July (because it was technically the 3rd of July, so I guess I was late even though I have until the 16th to pay). So, on the basis of them claiming I was three (3) months behind and the value of my home was $13k less than what I owe, they requested the release. I was very frustrated, because they had my June payment and I had just sent my July payment by the time I received the "release of stay" and now I have to pay an additional $600 for my attorney to represent me and prove that want to keep the house and plan to be current by the end of August. Blah!!! I am not sure how your mortgage company will react to your filing. Have you spoken to an attorney? How long until you can get closer to being current?

[BKMarty]

You must live in my neighborhood. house appraised $900k 2007. Just received notice of reduction in tax assesment for 2009-2010, assesed value $420K.

ITs absolutely insane how much equity we lost down here in florida I would have never imagined this. But on the bright side our property taxes will take a nice plunge last year we paid 13,200 hopefully I will be under 10K this year.

[Pizza]

In Ch.7, any secured property, including your house, you will have to keep making payments on if you wish to keep them.

[BKMarty]

You seem to have a unique situation. Like the others said, it is best to stay current if you want to keep you home after a chapter 7. I am in a chapter 7 and want to keep my home. When I filed I was a little over one payment behind (one payment, plus about 1/4 of another). Everything seemed fine until the next months payment (June) took two weeks to clear, which pushed it to the 1st of the next month. So, then I received a notice of the mortgage company requesting a "release of automatic stay." They proceeded to say that I missed the June and July (because it was technically the 3rd of July, so I guess I was late even though I have until the 16th to pay). So, on the basis of them claiming I was three (3) months behind and the value of my home was $13k less than what I owe, they requested the release. I was very frustrated, because they had my June payment and I had just sent my July payment by the time I received the "release of stay" and now I have to pay an additional $600 for my attorney to represent me and prove that want to keep the house and plan to be current by the end of August. Blah!!! I am not sure how your mortgage company will react to your filing. Have you spoken to an attorney? How long until you can get closer to being current?

Hi there and thanks for the input. I already retained an attorney but I wont be filing till the 1st mortgage is modified. Currently I let my mortgage fall behind by 3 months so that the bank has more incentive to work with my loan mod. Once they approve my loan mod my loan will be considered up to date and then I can file.
What happens with the "release of stay" what does it mean exactly?
I was more concerned with not being up to date with my second if there is no equity they are not going to push to foreclose so why is it that the trustee want you to be up to date on both mortgages on a ch7 specially if the 2nd is not secured by the property anymore and the personal liability will be gone after the BK.

[BKMarty]

In Ch.7, any secured property, including your house, you will have to keep making payments on if you wish to keep them.

How about if the second mortgage is not secured by the value of the home anymore and I just stay current on the 1st mortgage. Will that be an issue?
Its not like the 2nd mortgage will try to payoff the 1st take over the property and try to sell to try to recover some of their losses.

[ska]

What happens with the "release of stay" what does it mean exactly?
I was more concerned with not being up to date with my second if there is no equity they are not going to push to foreclose so why is it that the trustee want you to be up to date on both mortgages on a ch7 specially if the 2nd is not secured by the property anymore and the personal liability will be gone after the BK.

The "release of stay" means that the mortgage company can proceed with foreclosure or contacting you to get current. My fear is foreclosure. I also have a 2nd, but I am current with it; it is only $210 at this time.

I believe I have read some posts on this website wear people attempted to "stripe" their 2nd, but I am not sure how it turned out. I believe Jessegirl was one. However, I also think they were current with the 1st, not sure.