Experience Visit http://www.bklaw.com for more information on bankruptcy in general and Mark J. Markus in particular. Many questions are answered on the web page (hint, hint). The Markus webpage also contains more information on
Education/Credentials J.D., University of Arizona 1990. B.A. Economics, California State University, Northridge 1986. For more details please click here
Question I filed Chapter 7 Bankruptcy due to disability. Somehow, the 1st mortgage wasn't reaffirmed. The 2nd mortgage was. The bankruptcy was discharged in April 2008.
With disability back pay, I paid nearly all of the 2nd mortgage. But, I'm still upside down in my mortgage and requested a loan modification. I'm current on both mortgages.
If I'm offered a modification, will my loan remain "not affirmed" or will it be considered "reaffirmed" or perhaps a new loan?
Currently the credit bureaus have my 1st mortgage listed as "paid/closed" with no balance. And no payments have been reported since January 2008.
If they offer me a modification and the loan isn't reaffirmed, will the payments continue to go unreported?
I understand that under modifications they can report payments as being "partial payments". If the modification is considered a new loan, can they report payments as "partial payments".
No one seems to have the answers to these questions.
Thank you.
Answer "Reaffirmation Agreement" is a term of art used in bankruptcy and has no real meaning outside of it. You can only reaffirm a debt prior to receiving your discharge, so there is no more reaffirmation at this point.
If you enter into a loan modification, it is essentially a new loan--most likely a recourse loan--and if you fail to pay it, not only can the lender foreclose, but you could be liable for a deficiency judgment.
