In Chapter 13 and Behind on my Mortgage
I am in Chapter 13 and behind on my mortgage payments. What should I do?
I'm currently behind in my mortgage by at least 8 payments. I have sent a hardship letter to my mortgage company but got no response. I'm in Chapter 13 and do not know what to do.
Since you want to remain in the home you’re in a very good position already by having a pending chapter 13 case, as you can probably use that case to solve any issues between you and the mortgage company. I’m also going to assume that your Chapter 13 case was filed some time ago since the delinquency on your home was not raised and resolved during your filing. How long ago you filed your case will dictate how much time you have to cure the mortgage arrearage, since the lender’s ability to foreclose is greatly diminished while you are in bankruptcy. Since the mortgage is a secured debt, the bankruptcy judge will probably want you to bring it up to date in as short a time at as your income and approved monthly expenses will allow. The first thing I recommend you do is consult with your bankruptcy attorney as soon as possible to discuss the possibility of adding your mortgage delinquency to your Chapter 13 plan. Your attorney will likely be able to rework your repayment plan, allowing you to repay your delinquent mortgage with little or no increase to your current Chapter 13 plan payments.
If you filed your case yourself without hiring an attorney, I strongly recommend that you consult with and hire an experienced bankruptcy attorney to represent you for the remainder of your case. Bankruptcy law, especially Chapter 13 bankruptcy, can be extremely complex and confusing, and simple mistakes can have serious repercussions, often leading to the dismissal of an entire case. There-fore, your retention of an experienced bankruptcy attorney in your area should be your first step toward a successful resolution of your Chapter 13 case. Your attorney will likely tell you that putting your current eight months arrearage on your mortgage into your chapter 13 repayment plan should pose little problem. By resolving your mortgage debt through the bankruptcy courts, you will be protected from foreclosure while taking care of the arrearage as part of your Chapter 13 plan payments.
One very important fact to consider is that, although you may be able to include the arrearage in your Chapter 13 plan, you will still be required to make your regular monthly mortgage payments outside of, and in addition to, your Chapter 13 payments. Hopefully your income is sufficient to meet both obligations, but if you find that they cannot afford the bankruptcy payments and your regular mort-gage payments, you should consult with your attorney to discuss the best way to proceed. He may recommend that you attempt to sell the property through a short sale, or that you voluntarily surrender the property to the lender. Hopefully, your attorney will be able to work out an affordable plan with you before taking steps to modify your current bankruptcy case.
As I stated, the fact that you are already in a Chapter 13 bankruptcy puts you in a good position to save your home from foreclosure. The key will be to communicate with your attorney so that he can take the appropriate steps to protect your property and make sure that your payments remain affordable. I wish you the best of luck and hope that the information I have provided helps you Find. Learn. Save.
To read more about Chapter 13 bankruptcy, and how it may help you resolve your mortgage delinquency, you can visit uscourts.gov