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What happens when automatic stay is lifted before the Ch 13 bankruptcy is even confirmed?

Tampa, FL |

I have filed Ch 13 bankruptcy and have had my meeting of the creditors. The confirmation hearing is in a few days. Today I received a notice that the mortgage company filed and was granted a lift of the automatic stay. I was planning on 'letting go' of the house, but am surprised the mortgage company is proceeding so quickly. My questions are 1) the letter mentions debtor paying creditor attorney fees - is this normal? can they pursue collecting additional money (say for an unpaid mortgage payment?) 2) How does this affect the foreclosure timeline? will I be notified of when we have to be out of the house?

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Attorney answers 1


1) You will not be responsible to pay the creditors fees unless the court awards fees to them which is unlikely.
2) Once they obtain relief from stay, they can move forward with the foreclosure process. They can file an amended proof of claim for the unpaid amount after it is foreclosed.
3) Upon relief from stay by the creditor, they will resume the foreclosure process form where they left off before you filed so they do not need to start from scratch.
4) You will be notified when you have to leave the house and should consider negotiating "cash for keys" with the lender whereby they give you money to move out ($1500-$2000) to move out within a certain timeframe since it is cheaper than hiring a lawyer to evict you.

Mr. Larkin is licensed to practice law in CA and is located in San Diego. His response here does not constitute legal advice and does not create an attorney/ client relationship. The response is in the form of legal education and is intended to provide general information about the matter in question. Many times the questioner may leave out details which would make the reply unsuitable. Mr. Larkin strongly advises the questioner to confer with an attorney in their own state to acquire more information about the specifics of their case.