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Can I avoid foreclosure on my home through bankruptcy?
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Can I avoid foreclosure on my home through bankruptcy?

| Apr 9, 2021 | Chapter 13 Bankruptcy, Chapter 7 Bankruptcy, Foreclosure

The last 12 months have been difficult for many Georgia families. You may have lost your job in the economic downturn and business shutdowns. You and your spouse may have been struggling with debt before the turmoil of 2020, but now you feel overwhelmed by it. In fact, you haven’t been able to pay your mortgage in months and now you are facing foreclosure on your home. Can you avoid having to foreclose on your home through bankruptcy?

Bankruptcy and home foreclosure

Filing bankruptcy will put an automatic stay on your assets. As part of the automatic stay, your home foreclosure process will stop. If you file a Chapter 13 bankruptcy, you will be able to negotiate repaying your mortgage debt with your lender over a three- to five-year period. If you file a Chapter 7 bankruptcy, you may keep a specific amount of equity in your home through a homestead exemption. For example:

  • If you are single and file Chapter 7, you can keep $21,500 of equity in your home.
  • If you are married and file Chapter 7, you can keep $43,000 of equity in your home.

Getting help with your bankruptcy

If you think bankruptcy is your best option for debt relief, you should consult an experienced bankruptcy attorney. An attorney can help you determine if you qualify for a Chapter 7 bankruptcy or if filing a Chapter 13 bankruptcy is a better option. An attorney can help you file the paperwork and oversee your bankruptcy process.

Making the decision to file bankruptcy often isn’t easy. Yet if you are facing home foreclosure, filing bankruptcy can give you more time to figure out how to catch up with your mortgage payments or restructure your payments. You can discharge other debt and get a fresh start toward a better financial future.

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