Local Rule Rule 4008-2: Voluntary Modification of Debt Secured by Debtor's Residence in Chapter 7 and Chapter 13 Cases.

Rule 4008-2. Voluntary Modification of Debt Secured by Debtor's Residence in Chapter 7 and Chapter 13 Cases.

(a) Chapter 7. A mortgage creditor may negotiate a modification of its secured claim with the debtor and the debtor's attorney at any time during the pendency of a chapter 7 case. A modification is voluntary on the part of the secured creditor and the debtor and is subject to procedures set forth in LBF 751.7. The court will not consider a mortgage creditor's contact with the debtor or the debtor's attorney and any negotiation or implementation of a modification, by themselves, to violate the automatic stay of § 362 or the discharge injunction of § 524. A modification becomes effective when the trustee abandons the encumbered real property.

(b) Chapter 13. A mortgage creditor may negotiate a modification of its secured claim with the debtor and the debtor's attorney at any time during the pendency of a chapter 13 case. A modification is voluntary on the part of the secured creditor and the debtor. The court will not consider a mortgage creditor's contact with the debtor and the debtor's attorney and any negotiation to effect a modification, by themselves, to violate the automatic stay of § 362. A modification becomes effective when the trustee consents in writing or the court approves the modification.

(c) Approval of modification. If a modification agreement becomes effective under this rule, no separate motion or order for approval of it is necessary.

Cross-references: • Trustee's Abandonment of Debtor's Residence in Chapter 7 Cases – LBR 6007-1(b). • Definition of "Mortgage Creditor" – LBR 9001-1(v). • Agreement Relating to Relief From the Automatic Stay – LBR 4001-1.