Bankruptcy Law Questions? Ask a Bankruptcy Lawyer.
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I had some problems sleeping tonight so thought I would catch up on some stuff. I have a couple questions and fully understand if you are not online and can't respond until later today. I have practiced in the area of bankruptcy for several years.
I am presuming (correct me if I am wrong) that since you reference making payments of $133 per month until 417 then you have a chapter 11 plan that lays out payments over 5 years. After completion of all plan payments then you obtain the discharge. That is most likely why the bank is asking for the full $260 since nothing is final until you complete all plan payments. From their perspective if you stop making plan payments next month and that continues for a period of time then your plan will be dismissed for failure to comply with the plan requirements and then they can go back and collect as though there never was a chapter 11 plan.
I am sorry as this is probably not the news you wanted to hear, but I have a professional obligations to give you the most accurate answer I can so that you know what your rights are and can then act on those rights after consulting with a local attorney.
While the bank can legally enforce the original loan balance you may be able to have your attorney negotiate a settlement where they would take a lesser amount to be done with the loan. If the property clearly is not worth the $260 then they may be willing to take something in between in lieu of the potential of having to foreclose (if the plan fails) as they would receive much less typically in a foreclosure sale unless the bank buys it and holds it. You may be able to get them to allow what would amount to a short sell with the benefit being that they forgive the $80K or a portion as part of the deal?? Do note that if they forgive debt they will likely report it as forgiven debt to the IRS on a 1099C. I am ahead of things here as first thing is you need to find out if they are willing to negotiate a release of their lien for an amount less than the $260K. I may take a nap, but I will be back online later today and would be happy to reply to additional questions or further clarify my answer.
I took care of some things and just got back online. I see the request for a phone call. I just wanted to confirm that was you and not the website as it sends offers automatically. I will be available for some time this afternoon and can do a phone call if you prefer. A call cost $52 so just let me know if you want me to send you the offer and I will send it to you. Also note that you are welcome to just continue here for no additional fee, but I understand the typing gets kind of old and I don't type that fast myself. Let me know what you decide. If I don't respond immediately it is because I am dealing with another customer, but I will see it once you reply and will get to you next. Before I call I will confirm that you will be available.
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I wanted to check in with you and confirm that you did not have any further follow up questions for me from the answers I provided to you on the 26th. For some reason, the Experts are not always getting replies or ratings (at the top of the question/answer page you are viewing or in the pop up box for this question), which is how we get credit (paid by the Site) for our work, that the customer thinks have gone through. In your case I have not received a rating. If you are having technical difficulties with reading, replying or rating, please let me know so that I can inform the Site administrator. Please note that Site use works best while using a computer and using either Google Chrome or Firefox.
In any event, it was a pleasure assisting you and I would be glad to attempt to assist you further on this issue, or a new legal issue, if needed. You can go directly to my page for future questions by going here: http://www.justanswer.com/law/expert-ron-b/?rpt=3800