Filing for bankruptcy does not relieve you of secured debts unless you agree to surrender the property that serves as collateral for the loan. Consequently, victims of bankruptcy can only keep their house and car if they can still afford to make the monthly payments on the loans.

What happens if you have a mortgage and file bankruptcy?

A bankruptcy discharge is designed to wipe out your personal liability for most types of debt. In most cases, a mortgage lender’s lien (and right to foreclose on your house) survives bankruptcy. This means that if you want to keep your home, you must pay your mortgage during and after bankruptcy.

Will my house be paid off after bankruptcy?

Chapter 13 bankruptcy does not affect your home mortgage. You continue to make your mortgage payments during and after the bankruptcy. If you are behind in mortgage payments, you can pay off the arrears through your Chapter 13 repayment plan (which lasts three to five years).

What happens to my car loan when I file bankruptcy?

In Chapter 7, you have three options for dealing with a car loan. These options are to surrender the car, reaffirm the loan, or “retain and pay.” Surrender: If you file Chapter 7 and you wish to get rid of your car with a loan, you have the option of surrendering the car to the bank.

How to make your mortgage payments after bankruptcy?

1 Chapter 7 Bankruptcy and Your Mortgage. If you file (and qualify) for Chapter 7 bankruptcy and your home is exempt, you can continue to make your mortgage payments if you 2 Chapter 13 Bankruptcy and Your Mortgage. 3 Modifying Mortgages: Cram Down in Bankruptcy. 4 Getting Your Lender to Modify Your Home Loan. …

Can You Keep your mortgage if you file Chapter 13 bankruptcy?

In Chapter 13 bankruptcy, you can keep your home and continue with your current mortgage. If you file (and qualify) for Chapter 7 bankruptcy and your home is exempt, you can continue to make your mortgage payments if you want to keep your home.

Can a Motability car be sold during bankruptcy?

A Motability vehicle paid for using attendance allowance, disability living allowance (DLA) or personal independence payment (PIP) is a lease agreement. This means the vehicle doesn’t belong to you, so the official receiver can’t sell it. Your Motability agreement can continue throughout your bankruptcy.