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My mortgages were discharged from a recent chapter 7 bankruptcy. After months of battling with my lender, they finally offered me a permanent loan modification where the terms were changed to a lower interest rate and a shorter term. All the unpaid balances were added to the loan, dramatically increasing the principal balance. I have no intention of reaffirming the loan, just making a loan modification. I want to keep the loan for now because the payment is better than a rental.
I only have a week to make a decision, so I came up with the questions below. I hope I can get some expert advice before then:
1) By signing and submitting the offer, does it mean I'm accepting a new contract and reaffirming my debt?
2) If I accept it and default again in the future, can the lender come after me if I walk away?
3) Does the Mortgage Debt Forgiveness Act apply to this loan modification?