I am a little concerned with something. Everywhere I read says that creditors try for relief from automatic stay when they want to foreclose or reposs. I don't think that's always the case. My mortgage company worked out a loan modification with me, and they said they want the relief from stay just incase I default they can do collection activity. They said I am no where even close to foreclosure, and there intent of it is to just get the house out of the bankruptcy. Am I being misinformed by the attorney? I don't know why everything I read says it's for foreclosure.
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In the typical scenario, the debtor goes into the BK behind on payments and has no intention of keeping the house. Thus, in order for the bank to start foreclosure, they must lift the automatic stay.
Was this loan Mod worked out before or after you filed?
Are you current on payments? How is the mortgage being handled in the chapter 13 plan. -
Loan mod was worked out after I filed.
We are current according to the new terms on the modfication. If you call Litton, it says all the current terms from the modifcation. WE pay directly.Comment
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The court is not going to grant a lift stay for no reason. The lenders motion must state a reason to lift the automatic stay.
What you probably want to do, (if the bank wants to lift the automatic stay), is enter into a stipulation and order to lift the stay for this lender and attach a copy of the modification as an exhibit. That way the modification becomes part of the record of the BK case and the reason for the lift stay is known.Comment
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Thank you so much for your response. I checked Pacer and I see that my attorney filed an objection and requested a hearing. I called her office, but didn't get very far with her assistants, as I normally don't. If she requested a hearing, I'm sure I'll hear something from her.Comment
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Oh, I see, the lender has already filed for a Motion to Lift Stay. Have you read the motion...what is the lender arguing to justify the lift stay.Originally posted by klux View PostComment
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They filed all kinds of wrong information. They said I'm behind since July 2007, did not even file bankruptcy until October 2007. They have house worth 264,000, only 167,000. They didn't list anything about the modificaiton. I called the attorney, and they said, don't worry, my job is just to get this out of bankruptcy I"ll talk to my secretary about he wrong information, I'm sorry. They assured me that they would file an amended relief from stay, which they haven't. The paperwork for this was drawn up on 2/13...the modifcation was signed by me on 2/14 in front of a notary and returned overnight to them, and Litton entered everything on 2/28.....the attorney didn't actually send this until 2/27, even though dated 2/13. I guess I need to call their attorney and figure out what's going on. The us trustee would probably look at this and laugh with all the wrong information.Comment
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Ok...your attorney was right to oppose the motion as is, and ultimately, since you are represented by an attorney, this is a discussion you must have with them.
I guess my first question, is the modification worth it? What exactly are the terms of the modification? Did they reduce your interest rate, freeze an ARM...? For the modification to be worth it, it should have substantially altered the terms of the loan in your benefit. If all they did was put missed payments on the back of the loan, or something like that, then the mod is not worth saving.
Assuming the modification is worth it, Once you discuss this with your attorney, my suggestion would be this.
1. The lender withdraws their motion to lift stay.
2. There is two ways to handle the concerns.
2a. Normally, if the lender is at some risk, you do what is called an Adequate Protection Order. (APO). An APO is simply an order that allows the bank to simply file an affidavit with the court to lift the automatic stay in the event you violate the terms of the APO. Thus, all you do is attach the modification to the APO so that it becomes the terms of the APO and that is the end of that, both sides sign, and you are done.
2b. The other alternative is to do a Joint Motion and Stipulation and Order to Lift the Automatic Stay. The grounds for which would simply be that the Loan Modification is in the best interest of the Debtor (attach a copy),
Ideally, from your perspective, the best choice is a simple adequate protection order. Because really, that is the all the bank is asking for, is a way to protect themselves in the future in the event you default. But, it still requires the lender to go before the BK court and prove a default has occurred.Last edited by HHM; 03-17-2008, 02:33 PM.Comment
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IT was what I considered a good modification. My payments went down $100.00/month an d it is fixed for 30 years. IT went from 8.562 to 7.1 percent.Comment
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I suppose that is fine, it is not great, but it is a permanent modification, so that is probably worth saving.Comment
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