BK and Modification

September 2nd, 2010 Leave a comment Go to comments

In the past some lenders took the position that modification was not available to people in bankruptcy.

However, new regulations require mortgage companies to allow mortgage modification even if a borrower is in bankruptcy.

  1. Mathilda
    September 2nd, 2011 at 17:57 | #1
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    hi i was wondering, my husband and i are in the modifiaction plan with our 1st mortgage with bank of america…..may of 2011 was a yr since we made our 1st payment official payment….however, recently weve been falling behind we are now 3 months past due and i was wondering what the laws are with bankruptcy and modification…can someone that was approved for the modification program still claim bankruptcy on the home?

  2. James Robert Deal
    September 2nd, 2011 at 23:19 | #2
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    Yes, you can apply for a Chapter 13 bankruptcy after having done a modification. Given the fac that you are late on your payments, you are going to lose your $1,000 per year principal reduction, however somethings cannot be avoided. You should not file Chapter 13 until your lender is within a few weeks of foreclosure. You might ask the lender for a forbearance agreement, the right to get caught up gradually. Then you could avoid Chapter 13. I only do bankruptcy cases in Washington. Given that you are in Pennsylvania, I cannot help you in that regard. – James

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