Can Chapter 13 Save My House?

Many people are concerned about the mortgage crisis so widely reported in the news today. Foreclosures are nationally at a record-high. Unfortunately refinancing is not an option for most because they do not have enough equity in their home, so a good alternative can be filing a Chapter 13 bankruptcy.  Filing chapter 13 bankruptcy can be used to stop an imminent foreclosure and keep a roof over one’s head. Filing a Chapter 13 bankruptcy places an automatic stay on all collection proceedings, including stopping all pending or upcoming foreclosure proceedings and/or foreclosure sales.
Filing Chapter 13 bankruptcy, however, does not mean a foreclosure sale goes forever by the wayside. You are responsible to make your current monthly mortgage payments after the filing of the Chapter 13 bankruptcy.  If these post-filing payments aren’t made, your mortgage company can reinstitute foreclosure proceedings if they obtain approval from the bankruptcy court.   Chapter 13 works best for a homeowner who has a source of income, can make their mortgage payments under the repayment plan, and has not exceeded statutory limits on debt allowed under Chapter 13 (your attorney will explain this all).
Again, filing Chapter 13 is not a fool-proof end to a possible foreclosure.  Miss payments now and your lender is free to begin foreclosure proceedings again.  But, provided you make on-time payments under your repayment plan, you have a good chance of getting back in your lender’s good graces and, more importantly, keeping your house.

Click here to contact an experienced Chapter 13 bankruptcy attorney for help.

Attorney Adam Cerza

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