Can Bankruptcy Help Me Keep My Home?

Bankruptcy Lawyer Bryan W. Stone answers the question: “Does Bankruptcy stop foreclosure?”


Many people who are experiencing financial trouble have difficulty keeping up with many of their monthly obligations, including their mortgage payments. When a homeowner gets sufficiently behind on his or her mortgage, the mortgage lender may pursue foreclosure, which is the legal process through which a piece of real estate is repossessed. Once repossessed, the property is generally sold at auction so that the lender can mitigate the losses it has incurred. Fortunately for homeowners, there are often many ways in which filing for bankruptcy can help them keep their homes and lower their total monthly debt burden. For specific advice regarding your situation, call one of our highly experienced Charlotte bankruptcy attorneys today.


house-for-sale-Monroe-Charlotte-Mooresville-Bankruptcy-Lawyers-300x203The Automatic Stay


The automatic stay is an injunction that is put into place the moment a person files for bankruptcy that puts a halt to all collection activity, including phone calls, letters, lawsuits, and, importantly, foreclosures. While the automatic stay is not a permanent solution to an impending foreclosure, it can buy homeowners additional time to get caught up on their mortgage payments. In addition, when other debts are discharged at the end of a Chapter 7 bankruptcy proceeding, it can free up monthly income, making it easier to keep up on housing payments. Some of the kinds of debts that can be eliminated in a Chapter 7 bankruptcy include the following:


  • Credit card debts;
  • Medical bills;
  • Certain tax debts;
  • Business loans; and
  • Personal loans.


Chapter 13 Bankruptcy Debt Restructuring


The debt restructuring that is often available through a Chapter 13 bankruptcy is another way in which filing for bankruptcy can help homeowners avoid foreclosure. In Chapter 13, a debtor enters into a court-approved payment plan in which he or she makes one monthly payment to the bankruptcy trustee, which is then divided up between creditors. As long as the debtor makes payments according to the plan, he or she is protected from collection activities as long as the plan is in place, which is usually three to five years. Importantly, debtors who use this option need to make sure that they will be able to continue to pay their current mortgage payment, as only the arrearage amount becomes part of the Chapter 13 repayment plan. As in Chapter 7, most unsecured debts are discharged at the end of a Chapter 13 bankruptcy, leaving homeowners in their homes and with a significantly lower amount of debt than they had prior to filing.


Contact a North Carolina Bankruptcy Lawyer Today to Schedule a Consultation


Individuals who have fallen behind on their mortgage payments are in danger of losing their homes may be able to benefit from bankruptcy. The skilled Charlotte bankruptcy attorneys of Arnold & Smith, PLLC are committed to helping consumers obtain a fresh financial start through utilizing the protections offered by the U.S. Bankruptcy Code. Contact us today for a consultation of your case. We want to guide you through the bankruptcy process so that you can begin toward a better financial future. If you are contemplating bankruptcy in the Mecklenburg County, Iredell County or Union County area, please call the skilled lawyers at Arnold & Smith, PLLC at 704-370-2828 or find additional resources here.





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