can we refinance out of our chapter 13 BK?

[dkizzle]

Hi guys, Im new to this forum and recently got some information from a local Mortgage Broker ([link deleted by moderator]) who specializes in Chapter 13 refinances. Based on the content of the letter, it sounds like something I definitely want to do bc we have a lot of equity in our home and our chapter 13 payments are over 800/mo. We also have a 8.75% on our current mortgage which will be adjusting within 6 months. These guys apparently can get this qualified for a FHA loan in the low 6% range.

Here is my dilemma!

I read somewhere that if you pay off your chapter 13 within 36 months (i'm on a 5 yr plan) they can make you pay back the full amount of the debts, as opposed to the amount that was agreed upon, but if you wait 36 months, then you can actually payoff the agreed amount. I've only been in the plan for 18 months. Any input on the legitimacy of this? any input on the legitimacy of the lender? The guy I spoke with on the phone was very helpful but told me I would need a payoff letter from the trustee in order to know for certain the exact payoff amt, and that every case is a little different.

THANKS IN ADVANCE! ANY HELP WOULD BE HELPFUL!

[chpxiii]

I can only go by my experience and trustees may be different in other districts.

I believe that you do have to pay into your plan atleast 36 months. If you want to pay it off earlier than that, I don't know if you have to pay 100%. You can call your trustee's office to find out.

As for getting a loan, if you are going to get a loan to pay off your chapter 13, you will need to petition the court for the loan. I know that while you're in chapter 13 you cannot get a loan or incur any more debt (exceptions are for buying a car (some types) and a home - but even then you will still need to petition the court for a loan) which is why you need to petition the court.

I paid off my chpt. 13 early, but I had already been paying into it for 51 months - it's only a 9 month early payoff. In my pay off amount letter it said that if I were going to borrow money to pay off the chapter 13 I would need to petition the court for a loan. Fortunately I did not have to do that. (I'm in Dallas, TX if that makes a difference.)

[SinkingFast]

The way it was under Old Law was,............

If you were in a 5 year plan paying back less than 100%,........ You could refi your home and buy-out of Ch 13 AFTER you'd been in the plan for 36 months.

You'd pay the same total POT amount as if you'd pay the whole 5 years. If you wanted to pay off before the 36 month mark, the Trustee could ask you to pay out at 100%.

We don't know how it's gonna be under New Law. No one's been in a New Law Ch 13 long enough to hit the 36 month mark.

If you filed with an attny, you'd be best off to Consult with them. Your attny will know what's likely to happen with your Trustee.