Legal Question in Bankruptcy in Connecticut

Re: Prepayment Penalties

The filing of a Chapter 7 does not change your prepayment penalty. If you intend to keep your home, you have to make your payments. The only issue is that in the event you decide to surrender your home, the lender cannot sue you for any deficiency, including the payment of any prepayment penalty.

A Chapter 7 petition can be filed by an individual. Usually, because the debts owed are greater than the amount of being received. The issue whether a Chapter 13 petition would be if you intend to make your payments to creditors over a period of time for a period of time of a maximum of 5 years. The other reason for filing of a Chapter 13 is to save a home. To create a way to reinstate the mortgage and stop a foreclosure action. The amount that has to be paid in a Chapter 13 is the amount that creditors would receive in the event of a regular bankruptcy petition. The amount to be paid has to be based on what dividends would be paid in a Chapter 7. The feasibility (whether you can afford to make the payments) while also be a critical issue.

I hope that this is of assistance.

Good Luck.