First of all, you can't reaffirm a debt after discharge, so that matter is moot. To the best of my knowledge, a loan modification is just that: a modification of an existing loan. It is not the creating of a new loan (such as a refinance would be). Thus, it should not affect the discharge of the debt, and you should be able to default later without any further financial obligation (although obviously they could foreclose on their lien).
Mark J. Markus, Attorney at Law
Handling exclusively bankruptcy law cases in California since 1991.
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Legal disclaimer: Mark J. Markus practices law in California only. The information is not, nor is it intended to be, legal advice. You should consult an attorney for individual advice regarding your own situation. Answering this question does not in any way constitute legal representation.
1. No, it is just a loan modification and not a new contract.
2. Yes, the lender can declare a default in the future.
3. Yes. Debt reduced through mortgage restructuring, as well as mortgage debt forgiven in connection with a foreclosure, qualifies for the relief under the Mortgage Foregiveness Debt Relief Act. See:
The information presented here is general in nature and is not intended, nor should be construed, as legal advice. This posting does not create any attorney-client relationship with the author (who is only admitted to practice law in the State of California). For specific advice about your particular situation, consult your own attorney.
When a lender makes a loan modification, they are simply changing the terms of an existing loan. It does not create a new contract or reaffirm your debt. If you stop paying the mortgage, then the lender retains the right to foreclose on you. Whether they can come after you to collect any money depends a lot on the modified loan that you have but generally, California is a one-action state. This means that a lender that forecloses cannot also sue you later to collect money. They only get to take one action against you-- the foreclosure. If this home is your primary residence, the mortgage debt forgiveness act does apply.