BK and Mortgage - Lower Interest Rate?

[so_far_in_debt]

Has anyone ever heard of getting a mortgage company to lower the interest rate on a home loan so the house didn't have to go to foreclosure or BK?

[so_far_in_debt]

Lots of questions

I have some income from a land contract can that be attached by a creditor if I don't pay my bills?

Where can I find out about the means test I keep hearing about and exactly what is it?

I am currently in school and using student loans to pay the tuition will I have to quit because I will be incurring new debt (student loans) during the BK process? That would be a bummer especially if I am on a 5 year plan.

What is reaffirmation on a house and how does it work?

Sorry for all the questions I am brand new to the site and trying to learn as much as I can

[Grace]

There's absolutely no way a bank will lower your mortgage rate because you're having financial problems. That's not how the lending industry works. You signed a loan agreement. The only way to change the terms is to refinance.

[lrprn]

I have some income from a land contract can that be attached by a creditor if I don't pay my bills?

Yes, if your creditor goes to court and gets a judgment against you.

Where can I find out about the means test I keep hearing about and exactly what is it?

This online article does a good job of explaining the now mandatory Means Test in understandable language - http://ezinearticles.com/?The-New-Ba...glish&id=74968 . For an example of the Means Test set up for your state's bk standards, go to http://www.legalconsumer.com/bankrup...0801#QuickTest , put your own zip code in the field at the top of the page, then click OK.

I am currently in school and using student loans to pay the tuition will I have to quit because I will be incurring new debt (student loans) during the BK process? That would be a bummer especially if I am on a 5 year plan.

Because federal and private student loans are not dischargeable in bankruptcy (except in a very few circumstances), you can still get school loans during bankruptcy with your trustee's permission. See http://www.finaid.org/questions/bankruptcy.phtml for a good explanation of your options for financial aid during bankruptcy and how to get it.

What is reaffirmation on a house and how does it work?

Under the new bk law that went into effect in Oct 05, you officially have three choices of what you can do with secured debt - reaffirmation, redemption, or surrender. By signing a reaffirmation agreement for your home mortgage, you agree that you will still pay the debt according to the terms of the original mortgage agreement. The reaffirmed debt is legally enforceable if you stop paying later on (in other words, the creditor can foreclose on your home), and the mortgage company retains the security interest in your home until the mortgage is paid in full.

Hope this helps! Keep searching the forums and asking questions - it's a good way to learn what's important about bankruptcy so you can protect yourself better and also will give you lots of questions to ask your lawyer!