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Terry L.
Terry L., Attorney
Category: Bankruptcy Law
Satisfied Customers: 2889
Experience:  Better Business Bureau. 18yrs bankruptcy experience. Chicago Bar Assoc. American Bankruptcy Institute member.
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Im in a quandry. We are in Ch. 13 bankruptcy (about 1.5 years

Resolved Question:

I'm in a quandry. We are in Ch. 13 bankruptcy (about 1.5 years into the 5 year period). I am paying the Trustee who in turn pays all the creditors and we make the mortgage payments (we have 2---which is what got us into trouble in the first place!). Here's the deal. I haven't made any mortgage payments in about a year or so and no one has seemed to catch it. I've been wanting to resume the payments but am terrified that the banks are going to realize what's going on and foreclose. My banks are Citi (main) & GMAC(second). What should I do? Would we qualify for any of the interest rate reduction(the main is around 5.75 and the second is around 9) programs? For both mortgages? I very much don't know where to turn and don't want to loose our home.

FYI-our main is $1590 and the second is $700

I have around $1000 in savings

My husband and I make around $78,000 a year.

Thank you.
Submitted: 7 years ago.
Category: Bankruptcy Law
Expert:  Terry L. replied 7 years ago.
Since the post filing loan payments are treated as outside of the plan, you need to continue to make those payments. If behind, catch up. If the lender brings a motion to take it outside of the case, then they will bring a motion, you can either catch up or negotiate a repayment plan for that. You can always pursue a loan modification outside of the case, or a full refinance even. Have your lawyer draft a motion to get this approved, since you will need the court approval. show them the proposal once you work that out with your lender. Hope that helps. Keep paying the trustee as well. Thanks for your question and good luck .
Customer: replied 7 years ago.
There's no way for us to catch up as we are at least $30,000 behind. My question is how do I approach the lender so as NOT to cause them to foreclose? Should I just start making the payments, should I contact them, or should I work through the attorney?
Expert:  Terry L. replied 7 years ago.
That is the million dollar question. I would try to just make payments, perhaps it won't trigger anything in their system, but no guarantees. You can always let your bankruptcy case dismiss, and refile, including those additional arrears into the case.
There are pro's and cons of this though, so be sure to discuss this with your lawyer.
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