Chapter 13 Bankruptcy: Past Due House Payments and Denied Loan Modification Requests

Chapter 13 Bankruptcy and Catching Up on Past-Due Mortgage Payments

Bankruptcy Attorney

Federal Way Auburn Lake Tapps Bonney Lake Puyallup Tacoma Seattle

Over the past few months, many people have tried to modify their existing home loans. Unfortunately, most people have run into long delays concerning their lender.

People are under the impression that if they stop making their house payment that it will somehow “speed up” the lender’s decision process.

The reality is that missing house payments does not “speed up” the process at all. What it really does is put the homeowner at risk of having their house foreclosed.

Alot of people I have met with lately have missed their house payments and then had the lender deny their request for a loan modification. Now, those same people are 6, 7, 8, 9 months are more past due and facing a pending foreclosure of their home.

Chapter 13 may allow an eligible homeowner to catch up on missed mortgage payments through a repayment plan, usually lasting three to five years. Keeping the home also requires making ongoing mortgage payments and meeting the plan’s requirements. Filing does not guarantee that foreclosure will be avoided. If a sale is scheduled, seek advice promptly about the filing deadline and whether Chapter 13 is available.