B of A post-discharge loan mod charging interest on
Posted: Tue Jul 30, 2013 9:13 pm
For what it's worth, if they were to refinance the whole loan, they would
then start paying interest on interest, so I personally don't think it's
unfair.
I regularly try to get my clients (who are Chapter 11 debtors) deals where
all arrears (pre/post including fees etc) wrapped into the whole loan
amortized over 30 years. I find that most creditors counsel fight against
this type of treatment, and instead would prefer interest free cure
payments (like a balloon at the end).
Sincerely,
Michael Avanesian
Law Offices of David A. Tilem
www.tilemlaw.com
818-507-6000
On Tue, Jul 30, 2013 at 3:06 PM, lyounglaw wrote:
> **
>
>
> I have clients who received a BK discharge in March 2013. They have been
> in a trial mod for 4 months and received a letter from BofA that said
> "Congratulations. Your loan modification has been approved."
>
> The terms are generally favorable except this: Of the $41,864 arrearange,
> $34,108 is late interest. The terms include this phrase: "I also understand
> that this means that interest will now accrue on the unpaid interest that
> is added to the outstnding principal balance, which would not happen wihout
> this Agreement."
>
> I've heard where a bank will put the unpaid interest at the end of loan
> with a balloon payment, but it does not accrue interest on the interest.
>
> Has anyone had any experience with fighting this? This seems unfair. I'm
> continuing to research but hope someone can give me some advice on how to
> argue with the bank. Thanks,
>
> Laura E. Young
> Potier Law Group
> 5090 E. Los Coyotes Diagonal
> Long Beach CA 90815
> Phone: 562-986-9900
> Fax: 562-986-9100
>
>
>
For what it's worth, if they were to refinance the whole loan, they would then start paying interest on interest, so I personally
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