Selling a house while in chapter 13

[jsmith71]

Hi,
My husband and I filed chapter 13 about 2 and a half years ago. It has not been smooth, we have missed payments and had our trustee payments and mortgage payments increased. We are half way there, but now we are in a situation where we cannot make payments this summer because I do not work during the summer and we were not able to save enough to cover the payments.
we are also trying to refinance and it is taking a very long time.We are being told that this can happen even with the missed payments, but I am not so sure anyway. My main question is can we sell our house at this point and use the equity to pay off the chapter 13. We actually have alot of equty in the house, the amount that the house appraissed for 2 years ago has gone up and I do not want to lose this money if I sell it. Would we have to pay the trustee or creditors more money now that the house is worth more? I have been reading different threads on this site and someone suggested that we fire our attorney and stop making payments so that the chapter 13 would be dropped and foreclosure proceedings would start, so then we could sell and not be responsible for paying more to the plan since the house has more equity now than when we started. I want to get all the information that I can before we make a decision. Also, it seems like if we do sell the house we might have a hard time finding some place to rent because of our bad credit. Any advice would be greatly appreciated.
Thanks,
JS

[lrprn]

fi you filed 2 1/2 years ago, you filed under the old bankruptcy law and that's what your case needs to follow. Even under the old law, not making your Ch 13 payments on time can lead to dismissal by the trustee. Not making mortgage payments on time still means your leander can go to court to request removal of stay to start foreclosure proceeds.

I don't think anyone here will recommend that you just stop making your Ch 13 payments and let your case be dismissed. If you think having a bankrutpcy on your credit record is hard, wait until you have a *dismissed* bankruptcy on your credit record. The impact is even more harsh. You should work with your lawyer to see how your current plan can be saved or amended to reflect your current circumstances better.

Under the old law, Ch 13s could be paid off after two years of on-time payments. You are past that mark, but your payments haven't always been on time. It's still possible due to the time passed that if you sell your house, you could buy out of your Ch 13. Has your lawyer approached your trustee to find out what your payoff amount is and if your trustee would support an early buyout?