He or she reaffirms or renews the debt with
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Generally speaking, Chapter 7 bankruptcy provides two main benefits with respect to foreclosure:
* A discharge through Chapter 7 will eliminate your personal liability with respect to your mortgage; and
* The automatic stay stop foreclosure until the bankruptcy case is completed Mike Schmidt Jersey , or sometimes sooner if ordered by the judge.
For bankruptcy debtors that own their home entirely, their home may be retained all the way through the bankruptcy if there are enough exemptions available so that the equity in the home may be exempted. This will prevent the bankruptcy trustee from selling the home for the creditors’ benefit.
A debtor who has a mortgage on his or her home, and is current on the mortgage payments, can retain his or her home in the following two scenarios:
1. He or she reaffirms or renews the debt with the lender (“reaffirmation”). Specifically, reaffirmation is when the debtor agrees to continue pay under the original agreed upon terms Throwback Philadelphia Phillies Jerseys , or under a revised version of those terms, after the debtor receives a discharge. Please note that most lenders will agree to such an arrangement only if the debtor is not delinquent on his or her payments. But, if the debtor is behind on his or her payments, or falls behind on such payments, the lender will generally retain the right to foreclose upon the home; or
2. The debtors may decide to keep the home and continue making payments on it without executing an agreement to reaffirm the mortgage. The availability of this alternative depends on what state the debtor lives in. In California Custom Philadelphia Phillies Jerseys , this choice is available as long as the debtor keeps current on his or her payments. Please be advised that certain lenders may stop sending monthly payment statements to the debtor under this alternative.
Therefore, as a debtor, if you want to keep your home through a Chapter 7 bankruptcy, your mortgage payments must be current when you file for bankruptcy and must remain current through the entire bankruptcy as well as after you receive a discharge. If not, you are at risk of losing your home.
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