In response to:
“He filed a motion for a modification on my Chapter 13. Basically, I'm giving up my house. He explained that the mortgage company will object. . . He said worse case scenario, the remaining amount on my mortgage (whatever is left after the house is sold or auctioned) might be added to my Chapter 13 payments (a re-adjustment of the monthly payment) as he described.”
Ok, this kind of ticks me off.
1. Your lender is not going to object to a modification that says you are surrendering UNLESS you are in one of the few jurisdictions that says “once confirmed you cannot change your mind”. And even if you are in such a jurisdiction that usually happens to folks who want to later surrender a vehicle.
2. Worst case scenario is that you are going to have to raise your Plan payments to pay the deficiency claim after the property is foreclosed? Garbage. That deficiency claim could be a huge sum. You need to get clarification. If you are not in an anti deficiency state the lender can amend its claim from secured to unsecured. Doing so means it shares in the distribution already set up for all general creditors. The only time you should have to increase Plan payments is if your Schedule I & J dictate that you can afford to increase the payments. Now, if you will not be making a rent payment for 18 months then, at least for that period of time, you should be able to afford to pay more to your creditors. Get clarification on this.
In response to your actual questions:
1.You will be able to find a place to move but, your attorney is correct. . . you will be in that home virtually rent free for many, many months.
2. I am not sure about the homeowner’s insurance. The lender may place “forced placed” insurance on it which only protect the lender if something happens to the structure. “Forced placed” insurance does not protect you or your personal property so you will want to make sure full insurance is in place until you vacate. As to the property taxes. . . Check with your attorney. Property taxes normally “run with the land” and are not your personal responsibility. If this is the case you should not care if the taxes are paid.
Best regards.
Des.

