Keeping Your Home in Chapter 13 Bankruptcy

Keeping Your Home in Chapter 13 Bankruptcy

We know your home is important to you. One of the most common questions our clients ask us is whether or not they will be able to keep their home in a bankruptcy. Thankfully, with the help of a lawyer, their are ways to keep your home and lower your monthly payments.

Quick Note: If the sole reason for filing Chapter 13 bankruptcy is because you are at risk of foreclosure and losing your home, their may be other options. You can still save your home through bankruptcy alternatives.

The benefit of Chapter 13 bankruptcy is the ability to pay off “arrearage” which is simply the term used by courts to describe late and unpaid payments on your mortgage. Your “arrearage” can be paid off through your structured Chapter 13 repayment plan. You’ll also need to have enough money to pay off your mortgage, but in Chapter 13 you can eliminate payments on second or third mortgages on your home if your home has dropped in value because their is no longer equity securing the mortgages.

Avoid Foreclosure | Automatic Stay

“Automatic Stay” is the temporary stop of foreclosure. If a foreclosure has been brought against you, the second you file your Chapter 13 bankruptcy petition all foreclosure proceedings are halted. Foreclosure proceedings cannot resume until your Chapter 13 bankruptcy repayment plan has been approved. But during this time, you can create a repayment plan that includes provisions for paying off your arrearage.

Even if you don’t want to keep your home, you can use this time to stay in your home while your Chapter 13 repayment plan is structured. If you choose not to keep your home, foreclosure proceedings will proceed.

Keeping Up With Payments

When your payment plan is approved, lenders are required to accept your arrearage payments. At the end of your 3-5 year repayment plan, if your debts have been satisfied and you have kept up on your arrearage payments along with your regular monthly payments, you will be able to save you home.

This article is not meant as legal advice, and Bankruptcy is very complicated depending on every persons overall financial situation. So, if you are considering any chapter of the bankruptcy code, is it called one of our attorneys for a free, same day consultation.

To learn more about Chapter 7 or Chapter 13 Bankruptcy, the federal government has excellent information about it on their website at

Fairmax Law™ is a Service of Jaafar Law Group PLLC and is a designated debt relief agency that helps clients file bankruptcy under the federal bankruptcy code.

Fairmax Law is a debt relief and credit repair law firm, with attorneys in multiple states. We are dedicated to bringing people the fresh start that most Americans need. Whether it is a bankruptcy, or a credit repair program, Fairmax Law is the right choice.
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