if my home is in foreclosure status and I file Chapter 13 does that stop the forclosure?
If so do i get to keep my home and work out a pymt plan or what. Am I then required to pay all money due back mortgage pymts etc. or does the bankruptcy court set a new mortage pymt or plan?
A: You must bring the 1st loan current within the duration of the plan. To the extent that you have an excess disposable income, that will be allocated between all of your unsecured creditors, including the 2nd lender, and no matter how much or how little the 2nd lender, or any other unsecured creditor, receives during the duration of the plan, if you make all of the payments, then those debs will all be discharged.
Note: "Stripping" the 2nd loan from your house in Chapter 13 is not a free process. It requires something called an "adversary proceeding," which is a mini-lawsuit against the 2nd lender. You can expect that you cost you about $5,000 in additional legal fees, and the Chapter 13 itself could run $5,000. So, unless you have available cash, then despite the ability to strip the 2nd loan off the property, it may not be a realistic option for you.
Hope this helps.
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