Chapter 13 bankruptcy is often defaulted homeowners' only avenue to avoid foreclosure and remain in their homes. Debtors seeking to save their homes usually rely on Code § 1322(b)(5) which provides that a debtor may 'cure' a default. Many mortgage lenders object to debtors' plans proposing to cure the mortgage default on the grounds that the plan is modification of their rights, forbidden by § 1322(b)(2). Circuit courts have regularly allowed debtors to cure a default without running afoul of this anti-modification provision. The Fourth Circuit has abruptly turned course by disallowing such a cure. As a remedy, the author proposes an amendment to the Code to include a provision that defines a cure as a debtor's ability to nullify the consequences of default and restore the debtor to his pre-default conditions.
The "Cure" to the Homeowner's Bankruptcy Blues: An Analysis of a Homeowner's Ability to Cure His Mortgage Default under § 1322(b)(5) of the Bankruptcy Code,
Emory Bankr. Dev. J.
Available at: https://scholarlycommons.law.emory.edu/ebdj/vol34/iss1/6