Bankruptcy and Foreclosure

If you are facing foreclosure, bankruptcy might help save your home. Chapter 13 bankruptcy is often the best choice if you are behind on your mortgage because you can keep your home, continue making your regular mortgage payments, and make up the arrears through your Chapter 13 plan (over three to five years).

Chapter 7 doesn't allow you to make up back mortgage payments through the bankruptcy. However, if you can reduce enough of your other debt, it's possible you can work out a deal with your lender to make up the arrears, continue paying, and save your home. There are other issues with Chapter 7, however. If you have lots of nonexempt equity in your home, the bankruptcy trustee may sell it to repay your unsecured creditors, regardless of whether you are up-to-date on your mortgage or not.

Below you'll find articles about bankruptcy and foreclosure. And be sure to check out our articles in Your Home in Bankruptcy, for more information about what happens to your home and mortgage in bankruptcy.