Emory Bankruptcy Developments Journal


Andriana Glover


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.