November 20, 2017

Why You Must Pay Your Mortgage Directly After Filing Chapter 13

If you are behind on your mortgage, you can use Chapter 13 to stop a pending foreclosure and repay missed payments over the 5 year term of your Chapter 13 plan. However, filing your Chapter 13 case is only the first step in saving your home.

In Atlanta area Chapter 13 cases, your repayment plan will include a section which says that you agree to send in your regular mortgage payments as they come due during the term of your Chapter 13 plan. Your Chapter 13 trustee payment includes payments to the mortgage company to repay missed payment. Ongoing, future payments, must be paid directly to the mortgage company outside your plan.

Making your mortgage payments directly to your mortgage lender is part of your plan obligations.  Both your mortgage payment obligation and your obligation to pay your trustee start immediately after you file your case.  In fact, you will not be able to get your Chapter 13 case confirmed (approved) by the judge if your post-petition mortgage payments are not up to date. [Read more…]

What Happens After Your Chapter 13 Plan is Confirmed?

When your Chapter 13 plan is confirmed, it means that the bankruptcy judge assigned to your case has formally approved your plan of reorganization and all creditors are bound to the terms of your plan.

In the Northern District of Georgia, a hearing on the confirmation of your plan will be scheduled automatically a the time you file your case. Usually, these hearings are scheduled for about 2 to 3 months from the date you file your case. Therefore, you can think of the first 2 or 3 months of your plan as a kind of probation period.

While in this probationary period, you have all the benefits of bankruptcy – namely the automatic stay that protects you from creditor action – while the Chapter 13 trustee watches to see if you have the capacity to meet your plan obligations. This is also the time when creditor claims are filed and either creditors or the trustee can object to your proposed plan. [Read more…]

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