Hi - my name is XXXXX XXXXX I'm a Bankruptcy litigation attorney here to assist you.
What your attorney has said is essentially true. You can include your mortgage in your bankruptcy and can keep your house if you continue to pay the mortgage. Your lender will likely ask you to enter into a re-affirmation agreement that says you're keeping the mortgage debt and it will not be discharged in bankruptcy.
I do disagree with your attorney in that if you keep paying your mortgage and reaffirm the debt, the lender will be allowed to foreclose and seek a deficiency against you if you stop making payments at a later date. This is so because once you re-affirm a debt, it is not effected by the bankruptcy and the lender has a right to collect it.
Even if you don't reaffirm the debt, if you make one payment after the bankruptcy is discharged, you've reaffirmed the debt and you have no protection from the bankruptcy. Your action of paying during and after the bankruptcy establishes your intention to keep the property and the debt. If you do this and eventually stop paying, the lender will foreclose and sue you for any deficiency.
However, if you pay a few months during the bankruptcy and then you decide to discontinue payments, you can do so and the lender will retake the property by lifting the automatic stay and proceeding with foreclosure. The deificency would be discharged as an unsecured debt (meaning that you wouldn't have to pay it).
So why would my lawyer tell me otherwise? I know he was trying to help and not hurt.
He told me to call him tomorrow to tell him my decision. He also had me sign a paper that he had strongly advised me to NOT rea\ffirm the house since I do not yet have a job (a relative has been helping me with the payments). I need to stay in the house at least until June but my Ch7 deadline for discharge is March 7.
So how long will Bank of America let me stay if the house is not reaffirmed?
And then I HAVE to stop payments now?
Is that what you are saying?
As I said, if you keep making payments, the bank is not going to do anything because your account is not in default. However, if you pay throughout the bankruptcy and afterwords, and you then default, the closed bankruptcy is not going to protect you from the lender - because it's closed.
If you don't want the house, you should just let the bankruptcy deal with it now.
I'm sure your attorney's intentions are good, but I just can't agree that if you continue to pay the mortgage throughout and after the bankruptcy - and then you default 1, 3, 5, 10 years down the road, you can just walk away without any consequences. This is so because you've reaffirmed the debt by continuing to pay.
I've been practicing bankruptcy a long time and I've seen this happen several times.
OK I get the situation now.
One more thing.......How do I find out how long I can stay here before the bank kicks me out? And what does that entale? I'm asking because I have a child in school here and I cannot be out by March 7th. Do you know or should I call the bank or just wait till they do something?? thank you.
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