If you kept your house throughout the bankruptcy process, you are free to keep your home after the bankruptcy – as long as you continue to pay the mortgage. It may be that after you are free of all the rest of your debt you will be able to afford the mortgage payments easily. If so, you’ll be able to keep your house.

Does Chapter 13 pay off your mortgage?

Chapter 13 bankruptcy lets you pay off a mortgage “arrearage” (late, unpaid payments) over the length of the repayment plan — usually three or five years, depending on your income and the time it will take you to meet all the plan’s requirements.

Do I have to pay my mortgage after 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.

Can you keep your house and car in bankruptcy?

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.

How does filing bankruptcy help lower my house payment?

Filing bankruptcy does not help lower your house payment. It could save your house from foreclosure, though. You have two options when it comes to bankruptcy: Chapter 7 and Chapter 13. In a Chapter 7, you petition the court to discharge all your debts including your deed of trust.

How does a chapter 13 bankruptcy affect your mortgage?

In a Chapter 13 bankruptcy, the court places you on a payment plan. You keep your house but continue to make your mortgage payments at the rate you currently owe. Any past-due balance is placed so you catch up over the length of your payment plan. If you are current on your payments but need to lower it, consider refinancing your home.

What happens if you default on your chapter 13 plan payments?

Since most of your creditors get paid through the plan specified in your Chapter 13 bankruptcy, they can obtain relief from the automatic stay (permission to resume collection activities) if you default on your plan payments. (To learn more, see Bankruptcy’s Automatic Stay .)

What happens if I Don’t Make my bankruptcy payments?

If you don’t make your plan payments, your bankruptcy case will not get confirmed. Confirmations often get delayed when the trustee or creditor objects to the original proposed Chapter 13 plan.