Can you keep your home after filing for bankruptcy

February 28th, 2007 by Questions

My Husband has recently lost his job Late last year, and we have been dealing with crediters, most have been very complient with making alternative payment arrangments ie: no interest for so many months ect. We had an issue with missed mortgage payments late last year, and were sent a letter from a lawyer– we managed to borrow some $ from Family to pay in December with the idea that we were caught up until Jan of this year ( the letter said Normal payments to comence January 07) However we received a notice in Jan of a missed Dec mortgage payment much to our surprise, then we had Jan to deal with, we have been served legal papers as of few days ago with regards to our mortgage holder wanting thier money plus fees . My husband is still unemployed and we have tried negotiating with them to no avail . My question is this, if we were to file bandruptcy what would happen with the house or mortgage company? is there still a way to keep our house after filing for Bancruptcy?
please advise.


One Response to “Can you keep your home after filing for bankruptcy”

, A licensed trustee said:

Bankruptcy laws deal with your unsecured debts – your mortgage is a secured debt (if you don’t make your mortgage payments then the bank has the right to take your house) and as such is outside the bankruptcy process.

The only way to keep your house is to keep up the payments. If your mortgage company is not willing to co-operate with you then you ned to give some serious thought to selling the house and moving. I know this sounds harsh, but the mortgage company has the right to expect you to keep your payments current.

Having said all of that, if you file bankruptcy or a proposal your mortgage company might be more willing to co-oerate with you. Often if the mortgage company knows you’ve taken steps to sort out all of your financial problems they are more willing to give you an extra chance to sort out your mortgage too.

Why don’t you use the links to find a trustee close to where you live and give them a call – it won’t cost you anything and it might help to talk to someone directly about your situation.

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