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Will Bankruptcy Save My House?

On Behalf of | Oct 6, 2020 | Bankruptcy

Facing the thought of foreclosure can be scary, but unfortunately it is not uncommon. Many families in Texas find themselves falling behind on mortgage payments and in debt and more often than not, lenders are not willing to grant homeowners deals or modifications.

The potential of losing your home can be unbearable, but there may be a way to prevent foreclosure and save your home. One of these options is filing bankruptcy.

How Does Bankruptcy Work?

Filing for bankruptcy is a helpful process and it has a variety of benefits for people in overwhelming debt who need relief. The main is the “automatic stay.” This is a court order that forces your creditors to stop their collection attempts, including foreclosure sale. With an automatic stay, the foreclosure of your home must be postponed until after bankruptcy is finalized, usually in about four months, giving you time to create a plan to save your home or handle your debt.

Depending on the type of bankruptcy you file, you may be able to set up a repayment plan to pay off past due payments, including your mortgage payments, meaning you have the opportunity to save your home and avoid foreclosure.

In other cases, you can discharge your mortgage debt, but you may still lose your home. However, in these cases you still get rid of your debt, which can help you get back on your feet and start fresh. Bankruptcy has a variety of benefits that you may be able to take advantage of. Talking to a bankruptcy attorney can help you get a better idea of your specific situation and create a bankruptcy plan that’s right for you. In many cases bankruptcy can help you keep your home or at least decrease the negative impact on your circumstances.