Saturday, October 26, 2013

Do Trial Loan Modification Payments Reaffirm Original Mortgage Debt that was Discharged via Bankruptcy?

Question: I need to know if paying one or more 'trial payments' toward a potential mortgage loan modification will 'reaffirm' the original mortgage note which was discharged in a Chapter 7 bankruptcy several years ago. I do not want to reaffirm that debt and worry that a 'trial payment' might do that. The only reason to make the trial payments is to postpone the inevitable foreclosure sale.

Response: Making trial payments doesn't reaffirm the debt. Unless you selected that you are indeed reaffirming the debt in your Chapter 7 petition, all you are doing is making payments towards your loan so the bank wouldn't commence a foreclosure action or proceed with the foreclosure sale. Loan modification stays foreclosure actions. If the loan is modified, the case is settled and property will not be sold (unless you stop making payments again once the loan is modified). Also, trial loan modification after 3 months has to convert into a permanent loan modification. Once the permanent loan modification is executed, you no longer have to worry about the foreclosure sale taking place.

In the legal blog, Attorney Svetlana Kaplun addresses typical questions our firm has received from our clients, or come across from homeowners related to foreclosure, foreclosure defense, loan modification and bankruptcy topics.

The information contained in the legal blog of Attorney Svetlana Kaplun is for informational purposes only, and should not be construed as a legal advice on any subject matter. Please read our full disclaimer or contact the Law Office of Svetlana Kaplun, P.C. by telephone at 718-444-1115 for more information.
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