Expert: Mark J. Markus- California Bankruptcy Attorney - 10/2/2008

Question
Hello, we filed ch 7 and have our meeting of the creditors on Monday.  We are current on our mortgage, but still received a notice of release of stay from our mortgage holder, court date of 10/22 (Live in NH).  My mortgage says that since I'm current it will probably be dropped (but a hearing is still to go forward) as they don't want to foreclose on someone paying their mortgage (we had fallen behind 2 months, but I was constantly in touch with the mortgage company over this time), but never fallen behind in the past.  We also have a second mortgage (current) and now the 2 combined are (because of this wonderful housing market) not even close to what our house was worth back when we took out the second mortgage (also current).  My question is, will the mortgage holder go ahead with the stay since we owe much more than the house is worth? Or, since we are current (we hope to reaffirm with them) will they go ahead and proceed with foreclosure?  I'm hoping you know someone who has had a similar case and a positive outcome.  I haven't been sleeping or eating in days since receiving the release of stay and would just like a tiny light at the end of the road to hang on to.  Thank you for taking the time to help those of us on this website...

Answer
If you are current on your mortgage payments, I don't think they can foreclose, although that is really dependent on New Hampshire foreclosure law, of which I have no knowledge, since I practice in California.   They will likely proceed with getting relief from the automatic stay so that in the event you do subsequently default during your chapter 7 case, then they can commence (or continue) foreclosure proceedings without further permission from the bankruptcy court.