received default judgement...now what?

[Sick&Tired]

We are currently behind on September's house payment, and October's is due in less than 2 weeks. Basically I need to take the money for Sept's house payment to pay the remaining $1,000 retainer so we can go ahead and file our Chapt. 13 (I plan to pay this Thursday). The reason I am in such a rush is because we both received "Motion for Default Judgement" letters sent to us last week and this is freaking me out! What will we have to do? We do not have a court date yet. Will we even have to appear or can our attorney handle this? We will be able to make up Septemeber's payment by the time our first BK payment is due. I guess my question is what happens if we are 1 month behind on our mortgage payment at the time our first BK payment is due? Will this cause us to foreclose? What would you recommend doing?

[woeisme]

A judgement does not equal a crisis. I wouldn't rush my BK filing, especially if it means not making the house payment, over the letter. Basically all it means is someone sued you, you didn't fight it in court, so the judge sided with your creditor by default. Now whoever had the default judgement has to go back to court, get a wage garnishment, lein, etc, and even then, those will be wiped back off the slate when you do file Ch 13, so nothing to panic over. Your lawyer should be telling you this, but they also want their $1000 retainer, so won't tell you that this isn't panic time if it means they get paid sooner due to your panic. If the mortgage arrears are going to be covered in the plan, maybe no big deal, but don't think this is a crisis, just a snag.

[NowImDownInIt]

I don't think that this will cause you to foreclose, but I would be wary about trying to catch up on something while active in a plan. That's a difficult thing to do.. I would try to catch up before filing, unless you want to include the arrears in your plan... I dunno.

[casdem1]

We were four months behind on our house payment when we filed, so our arrears and house payment are included in the plan. An online pay day loan place tried to get a garnishment, which would have affected my job, so I was anxious to file as quickly as possible.