Can a Mortgage Loan be Modified after Filing a Case to Stop a Foreclosure?
Many people are attempting to receive modifications to the terms or the balances of their mortgages before the filing of their chapter 13 case. You may still apply for a modification of your mortgage even after you file but you must do all the paperwork directly and negotiate the new terms directly with the mortgage company. The filing of your chapter 13 does not make you more eligible for a modification and the court has no ability to force the mortgage company to modify the terms or balance of your mortgage on your home. The court must approve any modification in order for it to be final and binding, and the court will not approve a modification unless it is signed by both you and a representative of the mortgage company. My office cannot force the mortgage company to sign the agreement and we cannot file a motion with the court for approval until it is signed. The mortgage company representative may tell you that they cannot go forward with an offer of modification until they get approval from the court or the trustee but this is not the case; the court will not approve a modification until it has been offered with all terms stated clearly and it has been signed by both you and the mortgage company representative.
A lot of mortgage companies are very large and bureaucratic so you may have to stay on them and be the “squeaky wheel” in order to get a modification offer. They ask for a lot of paperwork and sometimes “lose” documents which can be very frustrating but you need to keep at them in order to get the job done. Don’t be afraid to bother them!