Expert: Terry Leeders - 2/20/2010

Question
My husband and I are in a Chapter 13 bankruptcy. We went through a seperation in November and fell behind in our mortgage payments. Our lawyer told us we had about six months before we should worry about the mortgage company requesting a realease of stay. We had gotten three months behind but were planning to get caught up. Two weeks ago I received a letter from the lawyer saying our bank had put in request for release. I want to keep my house and asked what I could do. Our lawyer said that Wells Fargo would no longer work with us and that we would have to go through them which would result in a hefty fee. My husband got in contact with our banks atty who told them they would work with us but that we had to get rid of our lawyer. What are our options?

Answer
You need to work out the deal with the lender to stay in good standing with the case.  I would recommend using your lawyer. If you don't want to, you need to fire them.  Lenders are usually willing to work repayment agreements to cure default. Be sure to review all terms as you have to give them the ability to send a notice of default in the future, so they wouldn't need to bring it to court again, it could be an automatic modification should you miss a payment.  Therefore, I always recommend have an attorney negotiate these for you.  Thanks