Does a loan mod after BK...

[mom2three09]

make you now liable for the loan even if it was IIB? I know I have read that a loan mod does not change anything (the debt remains discharged) but I guess I just want to be sure. We received a loan mod offer from BofA, but no where in the paperwork does it say anything about the fact that the debt was discharged in our BK last yr. I have read on another board that they usually include a "Modification BK disclosure rider" in the loan mod docs, but we did not receive one and now I'm getting a little nervous about accepting the loan mod offer Should there be some form included in our mod offer that states something about BK?? Anyone know??

TIA

ETA: I found the exact wording (online) of the Mod. BK disclosure Rider ... and it does look like it should have been something sent with our loan mod because it clearly states the debt was discharged in a BK and that the loan mod does not change that fact.

"Modification Bankruptcy Disclosure Rider". It reads, "This modification bankruptcy disclosure rider, effective on the 11th day of August 2010, is incorporated into and shall be deemed to amend and supplement the Loan Modification Agreement of the same date made by (me and my husband) and BAC Home Loans Servicing, LP (lender) covering the property described in the Loan Modification Agreement (LMA) located at (property address). Borrower understands and acknowledges that if Borrower breaches any of the terms and conditions of the Loan Modification Agreement, including but not limited to timely making the payments described in the LMA, that lender has a right to foreclose the property in accordance with the terms and conditions of the underlying Security Instruments. In addition to the covenants and agreements made in the LMA, the borrower and lender covenant and agree as follows: 1. Borrower was discharged in a Chapter 7 bankruptcy proceeding after the execution of the note and security instruments; 2. Borrower has or reasonably expects to have the ability to make the payments specified in the LMA, and 3. The LMA was entered into consensually and it does not affect the discharge of Borrower's personal liability on the Note

[despritfreya]

Two schools of thought. The 1st one below is probably more accurate:

1. A loan mod is not a reaffirmation agreement therefore the underlying obligation to pay the loan is still discharged and the borrower is just making voluntary payments.

2. A loan modification is sufficient consideration to create a new debt therefore it is now a post petition obligation.

I think lenders would be in deep you know what if they tried to attempt to enforce a claim as indicated in #2 so, don't lose sleep over it.

Des.

[helpme2010]

I have received 2 loan mod offers from the trustee that went to my attorney prior to my 341 hearing. I wanted to fill out the loan mod doc after the discharge to stall my foreclosure process. I did not plan to make any payments, just to fill out the loan mod package to give me a few extra months in the house and temporarily stall foreclosure while the trustee reviews the package in committee.

Anyone else have any feedback about doing this?

[tobee43]

i actually was contacted by chase AFTER the discharge and surrendering of the property....the approach was they tried to tell ME i reopened a loan mod application 1 day after my discharge date...are they nuts or what??? never happened so it's fraud...

anyway...they wanted to know if i was interested...now mind you, we have been out of the house for 2 years...i'm thinking NOT here..we don't even live in the state any longer.

actually chase asked two things...will we reaffirm the mortgage...(remember this is AFTER discharge and surrender)....and then when i said NO and if you were interested at the time of my bk why did you NOT contact my atty, but are attempting to now approach me???? i didn't see you at my 341 or see any ap filings......that's when chase then said..well you applied for a loan mod...i'm like NOOOOOOOOOO...i did not...the house and it's black mold is all yours...you called my bluff threw me out and now you want me back in there...

so, i hung up...that was approx 3 -4 weeks ago and i have heard nothing since.

personally....you couldn't get me to sign what you are posting with a ten foot pole...but that's just US....and you need to do what you feel is right for you and yours...please let me know how you make out on this...since i'm indirectly connected to a similar situation i'm very interested on how it pans out for you.

[tobee43]

Two schools of thought. The 1st one below is probably more accurate:

1. A loan mod is not a reaffirmation agreement therefore the underlying obligation to pay the loan is still discharged and the borrower is just making voluntary payments.

2. A loan modification is sufficient consideration to create a new debt therefore it is now a post petition obligation.

I think lenders would be in deep you know what if they tried to attempt to enforce a claim as indicated in #2 so, don't lose sleep over it.

Des.

if #1 is true, then is BOA attempting then to have them reaffirm the mortgage loan?

[despritfreya]

if #1 is true, then is BOA attempting then to have them reaffirm the mortgage loan?

Not sure what actions of BOA you are referring to but a Reaffirmation Agreement, to be valid, must have been fully executed prior to the entry of a discharge and requires very specific disclosures. It does not need to be filed before the discharge but all parties must have signed it before discharge, including the debtor's attorney if there was one. If this did not happen a Court is going to deny the reopening of the Case for the purpose of filing it.

Des.

[tobee43]

Not sure what actions of BOA you are referring to but a Reaffirmation Agreement, to be valid, must have been fully executed prior to the entry of a discharge and requires very specific disclosures. It does not need to be filed before the discharge but all parties must have signed it before discharge, including the debtor's attorney if there was one. If this did not happen a Court is going to deny the reopening of the Case for the purpose of filing it.

Des.

thanks des...so chase was really full of it when they called me after discharge to reaffirm....i thought maybe after reading the BOA Modification Bankruptcy Disclosure Rider that OP posted...it seemed as though it was an attempt at a reaffirmation....so it's confusing the heck out of me.

so to reaffirm it MUST be done prior to discharge. got it...i think until tomorrow when something new comes up.

why des..is this because no one really knows exactly how or what to do in these situations. after all, this is uncharted waters we are in...and so difficult to get any direct answers ...even my very competent atty is at a loss.

[despritfreya]

why des..is this because no one really knows exactly how or what to do in these situations. after all, this is uncharted waters we are in...and so difficult to get any direct answers ...even my very competent atty is at a loss.

I think we are in uncharted waters as it relates to the affect of a loan modification after bk. I believe, however, that the goal of bk, obtaining a fresh start, will tip the scales in favor of debtors if and when any litigation arises. Remember, the mortgage industry, well actually Wall Street, constructed this mess and consumers fell for it. Bk courts have always been consumer oriented especially when institutional creditors try to take major advantage.

Des.

[tobee43]

I think we are in uncharted waters as it relates to the affect of a loan modification after bk. I believe, however, that the goal of bk, obtaining a fresh start, will tip the scales in favor of debtors if and when any litigation arises. Remember, the mortgage industry, well actually Wall Street, constructed this mess and consumers fell for it. Bk courts have always been consumer oriented especially when institutional creditors try to take major advantage.

Des.

first....sorry OP for hijacking your thread!

well thank you des...sometimes it's quite lonely out here in those waters...a reassuring word once in while helps and frankly i have found few and far in between.

i personally don't want anything to do with the loan mod from chase and am working diligently to get our names off this deed. my warranty deed and general release worked well with one bank and one property we owned, however, with chase...i made the same offer but understand it was an fha with pmi and there is a process they must follow to recoup their loss...however...it is taking forever to foreclose and get the sheriff's sale moving on this other property...so i just have to sit tight and wait it out. my only two choices wish i had a third or forth... our counties sheriff's sale site even says..NO FORECLOSURES for the MONTH OF OCT...i have never seen that until this month.

thanks again des..very much appreciate you input!

[helpme2010]

Maybe my strategy of submitting the loan mod package after discharge is a bad idea.

I did not think this was a contract until they send me what the 6 month payment plan would be and then I would have to sign that 6 month payment plan document. I figured they would just process the package documents for a few months and then send me a 3 page document stating what the terms are and if I agree to the 6 month loan mod plan (of course I would not sign that document committing to the new plan).

Any thoughts?

[tobee43]

well....knowing me i missed it along the way somewhere...but do you want to stay in the house???

if you do...then you have some real thinking to do...personally, i'd be scared to death....but that's JUST me...and i surrendered the house...if you want to stay that's an entirely different story.

[helpme2010]

tobee43, I surrendered the house in ch 7. I want to stay in the house as long as possible, giving me enough time to find a job after discharge and then I will find a place to rent. Thus, I need to buy some extra months here to find a job first, then I can rent a house. I am looking for any strategy possible to buy me some more time in this house before I get kicked to the curb.

well....knowing me i missed it along the way somewhere...but do you want to stay in the house???

if you do...then you have some real thinking to do...personally, i'd be scared to death....but that's JUST me...and i surrendered the house...if you want to stay that's an entirely different story.

[tobee43]

ahhh ..ok that helps understand a bit better...

well, of course if you have already surrendered the property in the 7 and you are in calif. since your are a Non-Judicial state this is really a difficult situation...as there is no judge to plead you case to ask for more time.

but getting yourself into a loan mod i wonder if it's even possible after the surrender...well, let me take that back, since i was also approached since i guess the bank doesn't want the house...that may be the same in your case. what ARE the banks going to DO with all these houses.

[helpme2010]

I am thinking the banks may just want a body to live in the house until they are ready to get rid of the house. I would love to stay in the house until they are ready to find a buyer. If the bank could just give me a few months notice, that would work out great. I know this isn't reality, but I am really just trying to stay in the house until I get a job and can find a new place to rent (which will be closer to my work, my family, and my girlfriend).

If there is one positive note from this experience, it will be that I am hoping to finally be able to live much closer to my girlfriend, family, and jobs.

[tobee43]

I am thinking the banks may just want a body to live in the house until they are ready to get rid of the house. I would love to stay in the house until they are ready to find a buyer. If the bank could just give me a few months notice, that would work out great. I know this isn't reality, but I am really just trying to stay in the house until I get a job and can find a new place to rent (which will be closer to my work, my family, and my girlfriend).

If there is one positive note from this experience, it will be that I am hoping to finally be able to live much closer to my girlfriend, family, and jobs.

helpme ...it's great to find a positive somewhere in the mix of things...it's the best way to be under these circumstances...always looking for a bit of something that can help you smile...or be at peace...