Why File Chapter 11 for your Homestead instead of Chapter 13? 

3 simple reasons.

1) Chapter 11 allows you to spread your arrearages on your homestead property over the remaining years of the mortgage.

2) You don't have to pay Chapter 13 Trustee Fees (10%) of everything that is paid in.

3) You are in control not a Chapter 13 Trustee.

Example of Money Saved in Chapter 11 vs Chapter 13

Simple Facts:

Mortgage payment $2,000.00 a month

Arrearages on Mortgage $55,000.00

In year 25 of a 30 year mortgage, 300 months left.

Chapter 13:

$2,000.00 x 60 months   = $120,000.00

Mortgage arrearages           = 55,000.00

Strip 2nd                                   = $0.00

Chapter 13 Attorneys fees = $6,200.00

Total                                             = 181,200.00

Trustee fee  10%  181,200   = $20,133.33

Total                                             = $201,333.33

Divide $201,333.33 by 60 months given to you to cure the arrearages in a chapter 13 and your monthly chapter 13 plan payment is $3,355.56.

Chapter 11 using same facts:

 $2,000.00 a month for the rest of your loan

Mortgage arrearages           = 55,000.00

Strip 2nd                                   = $0.00

Chapter 11 Attorneys fees = $00.00  chapter 11 fees are aprox. $9,000.00 and have to be paid before filing the case.

Total                                             = 55,000.00

No Trustee fee                          = $0.00

Total                                             = $55,000.00

Your plan payment under a chapter 11 is the regular monthly mortgage payment of $2,000.00 and $55,000.00 divided by 300 months, the remaining number of months left in your original mortgage = $183.55. This means you pay your mortgage company $2,183.33 per month.

No Trustee fees and no outrageous monthly payments. The attorney’s fees are paid prior to filing a chapter 11 because the court doesn't really have a mechanism set up to allow an attorney to get paid during a chapter 11 case like a chapter 13. This is the only downfall of chapter 11 compare to chapter 13. Chapter 11 clients often ask "how am I going to come up with that amount of money". The answer is stop paying your mortgage for 3-4 months and you will have the fees.

The second mortgage and other debts will get paid the same amount if anything in chapter 13 or chapter 11.