Whether in a Chapter 7 or a Chapter 13 bankruptcy, a lender has the right to file a Motion to Lift Stay, to get at their collateral. This is typically only done by a lender when the debtor is not current, and if it is done when the debtor is current, then the debtor has a valid defense.
A lot of times when debtors get notice of hearing for the Motion to Lift Stay, they will ask me if they have to move out of their house on that day. The answer is no, and here is why.
Without filing a Motion to Lift Stay, a lender cannot assert its non-bankruptcy rights of foreclosure, because the debtor is protected by the Automatic Stay. Therefore, a lift stay order is not a foreclosure order. Rather, it is just an order allowing the lender to pursue its foreclosure rights through applicable state court methods.
In other words, once the lender is successful in its lift stay motion, it does not get to foreclose right away. Instead, the lender now has the same rights of foreclosure it had prior to the debtor filing bankruptcy. That means the lender must still follow the state law method of foreclosure, and it must start this process from scratch.
In Georgia, the lender must advertise for four weeks in the legal organ for the county of the property. It also must send certified notice to the debtor a month prior to the foreclosure sale. Doing the math, the lender cannot actually foreclose on the property until at least a month after the lift stay motion is granted.
Furthermore, lenders are not always chomping at the bit to foreclose. Often they do not want the property in their name for quite some time. Thus, they might go months after a lift stay motion without initiating a foreclosure sale, if at all. The lift stay motion might have been solely about drumming up attorney fees.
As a debtor, you have several options after the lift stay motion is granted. While you could move out right away, you could also wait to move until the foreclosure notice. Additionally, you could also ask your lender about renting the property or perhaps offer a cash for keys exchange to move out of the property early. The good news for the debtor is he/she is not reaffirming the mortgage, so the mortgage note is discharged regardless of when the lender ultimately forecloses. And if the bank takes it time to foreclose, the debtor can take advantage of this arrangement to continue to live in the property, perhaps even rent free. That is especially important because any place the debtor would likely move, he/she would instantly begin paying rent.
However, it is important to note that until the property is ultimately foreclosed upon, the debtor is still on title. Being on title, the debtor is liable for any injuries on the property, code violations and association dues. Therefore, the debtor should make sure to keep the property up to code, pay post petition filing date association dues and maintain insurance on the property until title switches hands. The last thing a debtor wants to do after filing bankruptcy, is to incur post petition debts relating to a property they are no longer living in. As those debts would be incurred after the filing date, they would not be discharged in the debtors bankruptcy case.
For an additional perspective on the pros and cons of walking away prior to a foreclosure sale, read this.
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All good points. By example, in one of my recent bankruptcy cases, it was more than SIX MONTHS between the order for relief from stay in the Chapter 13 and the filing of the FIRST STEP in a California foreclosure. There often seems to be no connection or communication between the lawyers for the banks who appear in bankruptcy court and the foreclosure arm of the same bank. Go figure.
I filed bankruptcy in South Dakota. I included my mobile home in the bankruptcy.It’s been discharged since September 2016. If I look for another place to live and therefore don’t make payments on my mobile home, how long would I have before the bank forecloses, repossesses, or whatever on it?
This will depend on your state law, lender and desirability of the asset. There is no way to predict when this would happen, and it’s actually unrelated to the bankruptcy filing.
I will be 4 days late on a caught up payment which is under a drop dead provision. My other payment to the trustee are being made on time. Will this cause me to loose my house? I’m under chapter 13th. It was a 6 month caught up pymt agreement.
I’m unclear by what you mean as far as a “drop dead provision.” I think you are saying you defaulted on your mortgage payments while in ch. 13 and then you worked out a consent agreement to re-pay that, and you are now 4 days behind on that.
Assuming that to be the case, the terms of your consent agreement will govern. If you are in fact behind on the terms of your consent agreement and your lender has the right to file an affidavit of default and lift the stay, they may do so. Hopefully you will get your payment in before they do that.
Separately, just because the bank lifts the stay does not necessarily mean you will lose your home. This will depend on a variety of factors, including whether you can work out a loan modification with your bank, refinance, your state law on foreclosure, whether you file a new bankruptcy case and get the automatic stay, etc…
I went through foreclosure..filed bankruptcy after foreclosure cause I was not working thought I would be ok but the bank decided to motion for lift of stay to be removed..so u am at the point that I dont know what to do .just got a full time job.so after foreclosure probably almost a year went to court the guy told me that I needed to come up with something to keep my home like I said that is when I filed bankruptcy. But just a week after going to bankrupt court that is when they decided to come back after me.
Unfortunately I cannot answer your question unless you clarify a few facts. The information you provided is inconsistent and probably inaccurate. I would need to know the following:
1. Has a foreclosure already occurred, and if so when?
2. When did you file bankruptcy and which chapter? Have you received a discharge yet?
It does not add up that a bank would lift the stay if they foreclosed before you filed bankruptcy. Also, the bank would not lift the stay to “come back after you.” The only reason the bank would lift the stay is to be allowed to foreclose on the property according to your state law.
I filed bankruptcy last year and got behind. The lender has filef the 2nd motion to relief of stay. I was in the foreclosure process before the bankruptcy. I have a fha loan. What are my options? I can afford the loan now. Will i have a chance to reinstate? Will tje foreclosure start over now and get another date? I am in ga.
I can’t tell from your question whether you are in ch. 7 or ch. 13. The answer to which will change things. It looks like you are probably in ch. 13. Assuming so, and if your question is what can you do to reinstate within the case before the stay is lifted, you will have to attempt to workout something with your lender. If you mean the bankruptcy is dismissed and you expect to file a new case, you can do so before your next foreclosure. It appears as if you have not had multiple filings in the past year, and therefore would get the automatic stay. The lender would need to send you a new foreclosure notice.
I filed for chapter 7 bankruptcy and discharged August 18th 2018
I am still in my home and not paying my mortgage.
When do I have to move out by?
Will I get a certified letter telling me to move out.
And in Georgia the lender has to advertise in paper for four weeks
What fallows after that
What is my best option?stay put?
There is no particular “move out” day, as the ultimate foreclosure sale date is presently undetermined according to what you stated. Yes, the foreclosure process will be the same regardless of the fact you already filed ch. 7. The bank will have to advertise your sale date for 4 weeks before the auction. You could in theory file a ch. 13 before that sale date to save the house. You could also just walk away or attempt to sell it (perhaps there is even some equity).
There is no way to know your “best option,” without examining your individual case facts.
Hello I filed chapter 13 and got behind in payments. The mortgage company has requested that the automatic stay be lifted if I fail to make the past due payments. I have requested the money from my 401k but they will not release the money until I have a foreclosure letter. If I make the payment after the automatic stay has been lifted will I be safe to stay in my home.
This could possibly be district specific, but I suspect that whichever district you are in will require bankruptcy court approval before you can withdraw from your 401k while you are in Chapter 13. Your Chapter 13 payments are supposed to come from “regular monthly income,” and a 401k is not regular monthly income. That being said, given the right circumstances, it is possible the judge would approve that withdrawal.
Note this is a separate issue from whether your 401k will then release the money to you, assuming the bankruptcy court approves. There may be specific language within your 401k policy that restricts the withdrawal, but that is independent of the bankruptcy court process.
I file ch13 in April, I’ve been making my regular mortgage payments. In August I called in to make the payments, I was told to pay a less amount than usually like $18.00 less. I was worried it was too low, the mortgage agent said that was the amount due. Now the payment never got applied along with all my other payments thereafter. Meaning all payments made after August was just sitting in my loan account. October payment was due, I come to find out the bank requested a motion to lift the auto-stay. I never received a letter from both bank or my attorney to notify me of the shortage mortgage payment that was made back in August, Now I’m facing court apprence this month. According to my attorney I’m behind 3 months, And there could be a payment plan for 6-8 months on top of my regular mortgage payment & my Ch 13 payment plan. That’s allot to pay back. In this case who is at fault? Bank or my attorney? I never received a letter about my shortage.
What can I do in this case? I want to keep my home. But if the motion gets approved by the judge. Can I sell my house while still in Ch13 during a foreclosure? Please help!! Thank you
The issue with the mortgage holder should be addressed with the judge at the lift stay hearing. Although this is not directly related to the lift stay motion, to answer your question about selling a house while in Ch. 13, the answer is your court will require court approval to sell it. It’s highly unlikely you get this done while your case is still pending, particularly if the home has no equity.
I did file chapter 13 and I was told to pay my mortgage. I did until I fell on hard times. I was sent the letter that they will lift my stay on 1/7/2019. I’m still paying the chapter 13 for my other bills. My questions is I long can I stay in the home. I want to make an arrangement. Do not want to wait at the last minute.
If the bank is granted a lift stay, that means it can now foreclose under your state law. Therefore, the answer to this question will be dependent on which state you reside. The main point to take away is that lifting the stay allows the lender to foreclose on your property just the same as your state law would allow it if you were no longer in bankruptcy.
During chpt 13 we fell behind due to my medical disability. Lender was granted relief and the sale date is set for 2/13/19. In Illinois is it way too late to try to stop/halt/delay the sale we want to try to keep our home.
Once the stay lifts, the bank is able to foreclose on your house according to their normal state law rights (i.e., the same method they would have used to foreclose had you not filed bankruptcy). Therefore, you would need to consult with an Illinois foreclosure defense attorney regarding your state law options.
Perhaps is it possible that a new bankruptcy could be filed to get a new stay, but whether the stay could in fact be imposed again depends on a variety of factors specific to your case and not addressed in your question.
Still in chpt 13 for one property, lifted motiin to stay on another. Is it posiible to appeal to trustee to revoke, reverse to keep the home in Illinois fell behind due to my medical disability only have 15 days to auction. Are there still any options left?
If you are trying to reverse a court decision, you would need to seek relief from your judge and not the trustee. I suppose it is possible due to some procedural defect with the motion to lift stay that the stay could be re-imposed; however, that is probably unlikely. Assuming you contested the motion on the merits at a hearing, the judge would surely not reverse his/her decision.
I filed for chapter 13 bankruptcy. I was currently behind on my mortgage payments. I was instructed by my bankruptcy lawyer to pay my mortgage payment for this month. My first court appearance with the Creditors is in 2 weeks. I have a feeling that the mortgage company lawyer is going to request a motion to lift stating to the judge that I can’t afford my home. Is there anything I can do to save my home? Wht if I can’t afford to pay the arrears? Also, am I entitled to my tax refund?
I am unclear when you say you are currently behind on mortgage payments if you are referring to before you filed ch. 13 or after. It appears as if you mean before, and you are current on the mortgage since you filed and in compliance with the plan.
The mortgage company will not lift the stay if you are current on your mortgage payments since the case was filed. You can save the home by complying with the plan terms and making the necessary payments.
As to whether you are entitled to a tax refund, this will depend on your district and local plan rules.
We filed for chapter 13 bankruptcy in 2016, since then we fell behind 2 months in Dec 2017 but our mortgage company filed incorrect amount saying we owed 6 months which caused a delay and reset court dates they were including the pre-petition arrearages. We finally came to a resolution in June 2018 to pay $6,150.00 up front and we had a consent order to repay the post-arrearages by paying our regular monthly mortgage payments and 8 half of payments for 8 months we fell behind on the last half payment but be were current on our regular monthly payments but the relief was granted. Even though the mortgage company filed incorrectly again saying we were 3 months behind on our regular monthly payments and missing 1 half payment. Despite showing our proof of payments thru our bank statements they was granted the relief from stay on 7/25/2019. But as of 6/1/2019 our mortgage loan was transferred to another company. Which they said we were not past due on our post petition payments and we had $1948.00 in suspense. Now that the relief was granted, There is an issue with the original amount owed in the bankruptcy which reflects $2,000.00 more than the original pre-petition amount. What options do we have?
You have a lot of issues going on, and it’s too numerous or complicated to discuss in a simple reply. If you have not retained local counsel, I suggest you do so.
Been in a Chapter 13 since 2016. Fell behind on mortgage payments and the stay to lift was granted 4/19 and my mortgage Co served me with the foreclosure complaint in May. I sent a response back to the court although was gonna let the house go. In July out of the Blue, they offered me a new 5 year mod with a much lower monthly payment and 2% interest for 5 years with the 3 month trial payments. Question is: Will my 2nd still be stripped upon successful completion of the chapter 13 (order was sign back in 2016 if I completed the 13) even with my 1st not being part of the chapter 13 case anymore?
I’m not clear what you mean by “I sent a response back to the court” about letting the house go. Did you formally modify your plan to surrender the home or not? If the plan has not been modified, then you are still under the terms of the original plan. If the plan has been modified, you could try to modify it again to retain the home based on the approved loan modification.
I am currently 4.5 yrs into a Ch 13 in NY. We recently got behind on our post-petition payments. The lender was granted the stay to be lifted. When I call they say we only owe last month and current month, no other arrears. The NDC website says the lender has been paid the full claim amount. The mortgage statement says the full claim amount has been paid. However, my lawyer keeps calling saying we are going to lose our home and that we need to dismiss and refile but, he can’t tell me what we supposedly owe the lender. Please help.
You appear to be confusing or conflating the two methods your lender receives payment during your ch. 13. Your lender receives ongoing payments directly from you for your current obligations. The lender also receives a payment from the trustee for your past due obligations. It appears from what you are saying as all of your past due obligations (arrears) were paid to the lender by the trustee; however, you have not maintained your post-petition payment obligations. The lender apparently lifted the automatic stay because you defaulted on your post-petition obligations. The lender’s ability to lift the stay was not impacted by the fact the lender’s claim for pre-petition arrears were paid in full by the trustee.
So as you describe it, the issue of the lender’s claim having been paid in full is largely irrelevant. The stay was not lifted on that basis. The stay was lifted based upon your post-petition default.
There are several different approaches here, which will vary based on a whole variety of factors. Complicating the situation is you appear to be close to a discharge date. You need to discuss the situation directly with your current attorney, and get advice that is directly applicable to your current situation. There is no general advice for this kind of scenario, and it is very case specific.
My tenant is on a month to month lease. When serving my tenant a notice to terminate, my tenant went and filed a chapter 7. I was granted my motion to lift stay. What are the next steps for me to take to get him out of my property
Assuming what you say is accurate, you now have the right to evict your tenant according to state law. You do not have the right to collect any deficiency or seek a judgment in that amount. The lift stay merely allows you to go through with getting an eviction according to your normal state law procedure. The bankruptcy is no longer an impediment to getting a writ of possession, and you can proceed according to your state law.