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Purely academic question on mtg. loan acceleration
The way I understand the issue is that only a confirmed plan can cure a contractual default. I'm not aware of an anti-acceleration provision that is applicablein chapter 7, off the top of my head.
However, home lenders have the right to accelerate loans for a variety of reasons such as an unauthorized transfer of title but I don't recall seeing a lender exercise that right. Why would the lender want to accelerate a loan merely because a bankruptcy case was filed when the borrower is willing andable to pay?Peter M. Lively, J.D., M.B.A.
Law Office of Peter M. Lively * Personal Financial Law Center I
11268 Washington Boulevard, Suite 203, Culver City, California 90230-4647
Telephone: (310) 391-2400* Toll Free: (800) 307-3328 * Fax: (310) 391-2462
On Tuesday, August 11, 2015 3:53 PM, "'Mark J. Markus' bklawr@yahoo.com [cdcbaa]" wrote:
Doesn't that only apply in Chapter 13 cases Peter? (I didn't mean to state that as a question--:))
So if that's it, then in Chapter 7 any mortgage lender can seek to foreclose if debtor is current with payments, if they have a loan default acceleration provision?
On 8/11/2015 3:41 PM, 'Peter M. Lively' petermlively2000@yahoo.com [cdcbaa] wrote:
1322(b)(3) Peter M. Lively, J.D., M.B.A.
Law Office of Peter M. Lively * Personal Financial Law Center I
11268 Washington Boulevard, Suite 203, Culver City, California 90230-4647
Telephone: (310) 391-2400* Toll Free: (800) 307-3328 * Fax: (310) 391-2462
On Tuesday, August 11, 2015 2:56 PM, "'Mark J. Markus' bklawr@yahoo.com [cdcbaa]" wrote:
I was responding to a posting online from some attorney in Georgia who stated that one should never file bankruptcy if they have a mortgage because the mortgage lender can accelerate the loan making it all due and payable. I said that was ridiculous. He asked me for my legal basis for stating it was ridiculous.
I said that, first, if his position were true everyone who filed a bankruptcy case that owned real estate would have their properties foreclosed on, which is obviously not the case.
But for more concrete law, I went to 365(e) for the ipso facto clause, which used to support that theory. But then I read 365(e)(2)(B) which excepts contracts to make a loan (which is what a mortgage is, I believe).
And then it was pointed out to me by Professor Hayes that loans are not even executory contracts, so 365 would not even apply.
So, what is the legal rationale for why mortgage lenders cannot accelerate the loans upon filing of a bankruptcy (assuming they have an acceleration provision in their Note)?
*************************
Mark J. Markus
Law Office of Mark J. Markus
Mailing Address Only:
11684 Ventura Blvd. PMB #403
Studio City, CA 91604-2652
(818)509-1173 (818)332-1180 (fax)
web: http://www.bklaw.com/
Certified Bankruptcy Law Specialist--The State Bar of California Board of Legal Specialization
This Firm is a Qualified Federal Debt Relief Agency
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Mark J. Markus
Law Office of Mark J. Markus
Mailing Address Only:
11684 Ventura Blvd. PMB #403
Studio City, CA 91604-2652
(818)509-1173 (818)332-1180 (fax)
web: http://www.bklaw.com/
Certified Bankruptcy Law Specialist--The State Bar of California Board of Legal Specialization
This Firm is a Qualified Federal Debt Relief Agency
________________________________________________
NOTICE: This Electronic Message contains information from the law office of Mark J. Markus that may be privileged. The information is intended for the use of the addressee only. If you are not the addressee, note that any disclosure, copy, distribution or use of the contents of this message is prohibited.
IRS CIRCULAR 230 NOTICE: To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. tax advice contained in this communication (or in any attachment) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed in this communication. #yiv9825479767
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1322(b)(3)Peter M. Lively, J.D., M.B.A.
Law Office of Peter M. Lively * Personal Financial Law Center I
11268 Washington Boulevard, Suite 203, Culver City, California 90230-4647
Telephone: (310) 391-2400* Toll Free: (800) 307-3328 * Fax: (310) 391-2462
On Tuesday, August 11, 2015 2:56 PM, "'Mark J. Markus' bklawr@yahoo.com [cdcbaa]" wrote:
I was responding to a posting online from some attorney in Georgia who stated that one should never file bankruptcy if they have a mortgage because the mortgage lender can accelerate the loan making it all due and payable. I said that was ridiculous. He asked me for my legal basis for stating it was ridiculous.
I said that, first, if his position were true everyone who filed a bankruptcy case that owned real estate would have their properties foreclosed on, which is obviously not the case.
But for more concrete law, I went to 365(e) for the ipso facto clause, which used to support that theory. But then I read 365(e)(2)(B) which excepts contracts to make a loan (which is what a mortgage is, I believe).
And then it was pointed out to me by Professor Hayes that loans are not even executory contracts, so 365 would not even apply.
So, what is the legal rationale for why mortgage lenders cannot accelerate the loans upon filing of a bankruptcy (assuming they have an acceleration provision in their Note)?
*************************
Mark J. Markus
Law Office of Mark J. Markus
Mailing Address Only:
11684 Ventura Blvd. PMB #403
Studio City, CA 91604-2652
(818)509-1173 (818)332-1180 (fax)
web: http://www.bklaw.com/
Certified Bankruptcy Law Specialist--The State Bar of California Board of Legal Specialization
This Firm is a Qualified Federal Debt Relief Agency
________________________________________________
NOTICE: This Electronic Message contains information from the law office of Mark J. Markus that may be privileged. The information is intended for the use of the addressee only. If you are not the addressee, note that any disclosure, copy, distribution or use of the contents of this message is prohibited.
IRS CIRCULAR 230 NOTICE: To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. tax advice contained in this communication (or in any attachment) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed in this communication. #yiv1632568618
The post was migrated from Yahoo.