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cfortunato, Attorney
Category: Bankruptcy Law
Satisfied Customers: 8023
Experience:  Bankruptcy professor.
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My chapter 7 discharge should be entered within 1-2 weeks.

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My chapter 7 discharge should be entered within 1-2 weeks. I am current w/ my mortgage payments and I want to keep my home. I realized that I did not reaffirmed my two mortgages that I have on my properyt. Is it necessary to do that? What is the advantage to reaffirm the mortgages? I want to apply for a modification on my first mortgage as soon as the chapter 7 discharge is entered. The loan modification on my second mortgage was approved prior to filing for Chapter 7. What happens if I do not reafirm the mortgage and I get behind on the monthly payments while I am doing the modification?
Also, can I modify my first mortgage without reaffirming the debt?
Finally, my daughter lives w/ me. She is my dependet, and she has a part-time job and made $2,050.00 in 2010? She wants to file her own income tax 2010. Is this will cause me any problem since I listed her as my dependent on chapter 7 petition?

Hi again,

There is absolutely no advantage for a debtor to re-affirm any debts. Re-affirmation only benefits the lender, because if a debtor re-affirms any debt - including a mortgage - the debtor remains liable for the debt even after the Bankruptcy, and this can present a major problem if something happens and you cannot continue to pay either mortgage.

Some mortgage companies will allow you to apply for a modification after a Bankruptcy, and some will not. However, there is nothing in the Bankruptcy rules which would prevent a lender from modifying a mortgage after the Bankruptcy.

A dependent for Bankruptcy purposes is not the same as claiming a dependent on one's income tax return. Accordingly, it is okay if you do not claim your daughter on your tax return.

Customer: replied 6 years ago.

What happen if I do not reaffirm my mortgage and for any reason I get behind on my mortgage payments after the discharge is entered? can the bank foreclose on my property right away?

Or what about if I apply for a loan modification after the discharge is entered, and while in the process of my loan modification, I get behind on my monthly payments? Can the bank foreclose on my property right away based on my bankruptcy status? or will try to modify my mortgage faster?


If you fall behind on your mortgage payments after the Bankruptcy, the bank can start foreclosure proceedings right away - whether or not you re-affirm the mortgage. The difference is if you stop paying the mortgage and you do re-affirm, the bank can get a judgment that can be used to garnish your wages and bank accounts for the next 20 years. If you do not re-affirm, the bank cannot get a judgment, and cannot try to collect the money owed on the mortgage.

After the Bankruptcy, the fact that you filed a Bankruptcy will not make any difference at all regarding a foreclosure, and the Bankruptcy will not result in a faster modification.

Customer: replied 6 years ago.
Thank you so much for your help. My last question is in regard of my car. My car is old and is giving me so much trouble. The value of the car is $1,200, I am fixing it because I want to sell it. Hopefully, after fixing the car, its value will increase to about $2,0000 . My daughter wants to use that money to buy me a car under her name because I would not qualify for a car loan on my own. Is it any problem to sell my car which was declared as exempt? Thanks
After the Bankruptcy, you can fix and sell your car.
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