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Are you facing foreclosure after your lender denied a request to modify your mortgage?  You may not only be able to save your house with a Chapter 13 bankruptcy filing but also successfully modify your mortgage while reorganizing your debt under the bankruptcy code.

A bankruptcy court-supervised mortgage modification program is now available to all Arizona residents, including those who live in the cities of Yuma, Tucson, and San Tan Valley.  The Chapter 13 Bankruptcy Mortgage Modification Mediation Program (“MMM Program”), effective February 1, 2017, was implemented to help people who file a Chapter 13 bankruptcy save their houses.  Prior to Arizona’s adoption of the MMM Program, mortgage modification was not part of the Chapter 13 process in our state.

The goal of the MMM Program is to assist property owners and lenders in reaching an agreement that is feasible and beneficial to both parties.  It may improve your chances of modifying a mortgage for the following reasons: 1) all parties involved in the mediation process, including the lender and its attorney, must act in good faith or otherwise be subject to court sanctions; 2) a mediator is appointed and responsible for facilitating communication and the exchange of information, as well as the discussion and resolution of issues; 3) documents are submitted to the lender via a secure online portal, eliminating issues regarding lost, unreceived, and incomplete documentation; and 4) there is transparency as well as bankruptcy court supervision over the process.

To be eligible to participate in the MMM Program, you must meet the following requirements:

  1. Be an individual;
  2. Have a chapter 13 case currently pending;
  3. Have the ability to immediately pay the applicable document preparation software fee ($40.00), the applicable MMM portal submission fee ($40.00), and $300.00 (one half of the $600.00 mediator fee) to the mediator;
  4. Have sufficient monthly disposable income to make a Chapter 13 plan payment of not less than the “Estimated Monthly Payment” [defined as the lesser of (a) 31% of the debtor’s gross monthly income less any amount paid towards HOA fees due for the property (exclusive of applicable Trustee’s fees) or (b) the regular monthly payment, or such other amount designated by the secured creditor for the property subject to the MMM Program]; and
  5. Have paid the bankruptcy filing fee in full prior to filing a motion to participate in the MMM Program.

The bankruptcy court will not force a modification and any agreement reached by the parties must be approved by the court to be binding and enforceable.  Although it is not mandatory for lenders to participate in the MMM Program, the majority of mortgage companies are registered participants.  Similar mortgage modification mediation programs have been successful in other states.  For example, the State of Nevada reported a 71% success rate in parties reaching agreements between January 1, 2015 and March 31, 2016.

The MMM Program is available to Chapter 13 bankruptcy filers only.  Chapter 13 may not be the best choice for you, but it is certainly worth exploring with a bankruptcy attorney if you are behind on your mortgage payments and want to keep your home.

Please feel free to contact me by calling 480-344-0981, or via email at  It would be my pleasure to discuss your situation with you.  The information I’ve shared in this post is not intended to constitute legal advice or create an attorney-client relationship.