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dkennedy
dkennedy, Attorney
Category: Bankruptcy Law
Satisfied Customers: 6009
Experience:  15+ years experience
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Hi there, I filed chapter 13 in September 2012. I own a older

Customer Question

Hi there,
I filed chapter 13 in September 2012. I own a older home that on the firest mortgage I owe 83K and on the second mortgage I owe 61K. The values have dropped considerably in recent years and now the home which was appraised at 190K is worth approx 120K.

A close friend is very old and is moving to his daughter's home and he wants to rent me his home for basically the same payment (1,100.00) a month as I pay here for the first and second mortgage. He would like to sell me the house and finance it himself.

Will I still be responsible to pay the second mortgage if I forclose our current home?
If yes.....then would I be able to dump the 60K second mortgage into my chapter 13?

Since his rental fee is the same as I report on my financial statement to Chapter 13 could the bankruptsy court prevent me from living there if I forclose and add my second mortgage to my Chapter 13?

His home is valued at 160K and we are in North Carolina.

Thank you.

Patrick
Submitted: 1 year ago.
Category: Bankruptcy Law
Expert:  dkennedy replied 1 year ago.

Hello,

 

I would like to help you with this, but there is something I don't understand. Why aren't your mortgages in the Ch.13 plan that you pay monthly?

Customer: replied 1 year ago.
Hi there,
The attorney did not include the mortgages in my chapter 13. I really don't know why.....he took 110k of medical and cc debt and put it only. I pay my mortgage payment now to the bankruptsy division of bank of america.
Thanks for your help.
Expert:  dkennedy replied 1 year ago.

Your mortgages must have been listed and the bank notified of your Ch.13, or you wouldn't be paying to the bankruptcy division. You cannot just make such changes as you proposed without going through bankruptcy court. You cannot just "dump" a mortgage into the payment plans. You may be able to amend the Ch. 13, or change it to a Ch. 7, but I doubt they would let you out of one set of debts (mortgages) just to assume another debt. You have to be careful and here's why. It sounds like a weird deal to me, changing payments for the same amount of payments, But more than that, if the court dismisses your bankruptcy, all the debt in full, will come back on you. You certainly don't want that. Discuss the amendment to your Ch.13 with your attorney, but it is my opinion that the court would not accept it, because it would take a secured debt and exchange it for an unsecured payment of the same amount, and in their eyes, not helping you get out of debt at all.

Please follow up with any questions you might have.

 

dkennedy, Attorney
Category: Bankruptcy Law
Satisfied Customers: 6009
Experience: 15+ years experience
dkennedy and 3 other Bankruptcy Law Specialists are ready to help you
Customer: replied 1 year ago.
...that makes perfect sense. My current house (93 years old) is in need of so much more repair and I don't have the funds to do all of this. The other house is a great house. I definetly don't want the court to dismiss my case so I guess I am stuck with this house.
If I forclosed on this house it sounds like what you are saying is that it may be grounds for dismissal and I would have all that debt back.
Just looking for some creative legal solution.
Thanks for your help!!
Customer: replied 1 year ago.


Hey Mr Kennedy,


I contacted the attorney's office that handled my case and he of course no longer works there.....go figure.


I decided not to take that house and stay where i am at. The legal assistant said he should have put both my 1rst and 2nd mortgages into the case.......go figure again!


Anyway I did rate your service at the highest.


Thanks,


PT

Expert:  dkennedy replied 1 year ago.
I'm sorry about the messed up bankruptcy, but think you made a good decision!! Best of luck to you.

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