Chap 13 and Mortgage

[smorberg]

I am trying to fully understand why a person would file a Chap 13 and reaffirm their mortgage or not reaffirm their mortgage. They can reaffirm and keep the property if they started getting behind (knowing that they will get caught up quickly), or they can put the mortgage in the Chap 13, and have the trustee make the payments, along with any arrear's (as long as it is accepted by the lender, which would mean a plan to pay everything current by the time it discharges, from what i have read). and keep the property. In both cases they can keep the property. The safe bet would be to put the mortgage in the Chap 13, but the only way i would see that a person would reaffirm the mortgage/property, would be to save his credit score, since he will be making the payments directly to the lender, thus the lender will continute to report the mortgage on his credit report, as agreed or 30 day late +..., if it is included in the Chap 13 and paid by the trustee then typically the lender stop's reporting the mortgage on the credit report, and sometimes they will report as Charged Off (i have seen this done on a 2nd Mortgage), or 120 + lates (if that's what the status was when it went into the Chap 13), which that will hurt the credit score.

Sorry for the long wind!

Thanks

 

[azatty]

I'm trying to fully understand your question. If the question is: "why would a person reaffirm a mortgage in a Chapter 13," the answer is, it's a tactical decision based upon the debtor's strategy.