Keep Your Home While in Chapter 13 Bankruptcy!

“Will I lose my house if I file Chapter 13?” This is a question we hear a lot from our clients. Bankruptcy can be confusing, so many people are unsure about filing. Keep reading if you are struggling with debts and thinking about Chapter 13 bankruptcy. 

Think of Chapter 13 as a repayment plan for folks with a steady income. It lets you keep your stuff while catching up on missed payments over three to five years. It is ideal if you are behind on your mortgage or stuck with other loans. You can catch up on those in the plan. Filing for Chapter 13 also stops creditor calls! If you feel the financial squeeze, Chapter 13 can be a lifesaver. 

Short Summary:

  • Filing Chapter 13 in Ridgeland, Mississippi, doesn’t mean losing your house. It is a repayment plan allowing you to catch up on missed payments over three to five years while keeping your property.
  • Chapter 13 rearranges debts, lowers payments, and provides a clear plan to become debt-free.
  • Filing Chapter 13 in Mississippi allows you to keep your house by catching up on missed mortgage payments over time. However, staying current on your regular mortgage payments throughout the process is crucial.

How Does Chapter 13 Bankruptcy Work?

Filing Chapter 13 bankruptcy is like Chapter 7, with some forms and a court fee (around $313). Here’s the big difference: Chapter 13 rearranges your debts. You can spread them out for longer, lower your monthly payments, or even wipe out some completely. 

 

You’ll make one monthly payment to a trustee, who then shares it with your creditors. These payments will usually be less than what you were paying before! That’s because you’ve stretched things out, lowered payments, or eliminated some debt.

Will I Lose My House If I File Chapter 13?

When you file for Chapter 13 bankruptcy in Mississippi, you usually get to keep your house. With this bankruptcy, you make a plan to repay some of what you owe over three to five years. You can hold onto your home if you stay current on your regular mortgage payments and pay off any missed payments (arrears). 

But remember, your mortgage payments will not be wiped out after you finish your payment plan. You still need to keep paying your mortgage to keep your home.

Will The Repayment Plan Work For Me?

Once your plan is approved, you should stick to it. That means budgeting carefully for several years and making regular payments to a helper (trustee). Remember, you can’t take on new debt without permission. If you miss payments, mess up child support or taxes, or cannot keep up, the court might stop your plan. But don’t panic! If things change, you can work with a lawyer to adjust your plan to get back on track.

What Will Happen If I Miss a Mortgage Payment?

If you miss payments because you were briefly out of work due to illness or another temporary job loss, your lawyer can ask the court to overlook those missed payments and explain how you’ll catch up.

What If I Missed Many Payments In My House? Can I Pay Them All in Chapter 13?

In Chapter 13 bankruptcy, you can catch up on missed payments for your house. But remember, you have to keep up with all future payments on time and pay a bit extra to cover the ones you missed. 

While you’re in the bankruptcy plan, the bank still owns the claim on your house (lien). If you miss payments again, the bank can take your house away (foreclosure) after getting permission from the court.

Can I Sell My House While in Chapter 13?

It is possible to sell your house during Chapter 13 bankruptcy. But you need the judge’s permission first. If they say yes, the money from the sale pays off your mortgage and might go to your creditors. 

How much depends on what’s left after paying off the mortgage. You can also keep some of the money thanks to exemptions. Those act as a shield protecting your home equity.

What Should I Expect If I Sell My House? 

The bank loan will be paid off first if the judge approves your decision to sell your house. Any leftover money might be used to pay back your debts. The amount available for debts depends on how much the house sells for and how much is left after paying off the loan. 

You might be able to keep some of the money because of special rules called exemptions. These exemptions allow you to shield some of the value of your house.

Is Refinancing Allowed in Chapter 13?

Even though it’s legal to refinance your house while you’re in Chapter 13 bankruptcy, most banks won’t let you do it anymore because of the Dodd-Frank Act. That means all the terms of your current mortgage loan will stay the same until you finish your bankruptcy plan.

Can I Discharge My Mortgage Debts in Chapter 13?

A Chapter 13 bankruptcy plan won’t end the bank’s claim on your house unless you pay it off completely through the plan. But there’s a chance to remove a second mortgage or other lien not backed by any value in your house. This type of lien is treated like regular debt and gets wiped out when you finish your Chapter 13 plan.

File Chapter 13 Bankruptcy Today!

Owning a home in Ridgeland and struggling with debt does not automatically mean you will lose it. Chapter 13 bankruptcy is a way to reorganize your debts, including your mortgage, so you can catch up on missed payments. 

We can help! We’re your financial guides here to get you back on track. Filing bankruptcy can be your fresh start. Our experienced bankruptcy attorneys have been helping people like you for over ten years.

Aside from Chapter 13 bankruptcy, we can also help you get a clean slate on most debts, keeping your house, protecting your wages, and much more!

You’re not alone. Life happens, and finances change. We’re here to support you through this. Our Mississippi lawyers have helped hundreds get a clean slate. Let’s build a brighter financial future together. Get a free initial consultation today!

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