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Chapter 13 Bankruptcy: A Homeowners Guide Pt. 2

Written by the ReZen Editorial Team

Welcome to Part 2 of understanding Chapter 13 bankruptcy and how it can help you keep your house. To go back to Part 1, click HERE.

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Step 7: Financial Management During Chapter 13

How do you survive Chapter 13 bankruptcy?

Surviving Chapter 13 bankruptcy requires careful financial management and adherence to the repayment plan. It's crucial to budget wisely, prioritize spending, and stay in close communication with your bankruptcy attorney. Making regular payments and avoiding new debt is key to completing your Chapter 13 plan.

 

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Step 8: Homeownership and Mortgage Considerations

Can you keep your house with Chapter 13?

Yes, Chapter 13 bankruptcy can help you keep your house by allowing you to catch up on missed mortgage payments through your repayment plan. It provides a legal framework to address mortgage delinquency and avoid foreclosure.

What happens with a mortgage in Chapter 13?

Your mortgage payments can continue as usual during your Chapter 13 plan for the ongoing payments. Any arrearages (missed payments) will be included in your repayment plan, allowing you to catch up over the life of the plan without losing your home.

What happens to my home after Chapter 13 discharge?

After a Chapter 13 discharge, any remaining dischargeable debt related to your home, such as second mortgages not secured by your home’s value, may be eliminated. You must continue making your current mortgage payments to avoid future foreclosure.

Is your house paid off after Chapter 13?

Your house is not automatically paid off after Chapter 13 unless your repayment plan specifically includes paying off your mortgage in full, which is uncommon. Typically, Chapter 13 focuses on catching up on arrears, not paying off the original mortgage.

Will Chapter 13 lower my mortgage payment?

Chapter 13 itself does not lower your regular mortgage payment. However, it can restructure mortgage arrears and other debts to make the overall financial situation more manageable. For a permanent reduction in mortgage payments, a loan modification would be required outside of bankruptcy proceedings.

 

Empowering Your Financial Recovery with ReZen

Embarking on the Chapter 13 bankruptcy process is a significant step towards financial recovery and retaining your home. It's a path filled with challenges but also opportunities for a fresh start.

At ReZen, we understand the complexities of navigating bankruptcy and its impact on homeownership. Our expertise and compassionate approach provide the support you need to make informed decisions about your financial future.

Partnering with ReZen means choosing a team that’s dedicated to your success, offering guidance and resources to ease your journey through Chapter 13 bankruptcy and beyond. Let us help you reclaim control of your finances and secure your home for the future.

Let's reclaim control of what is rightfully yours  Work with us

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