Although filing bankruptcy will stay (temporarily stop) a foreclosure action, whether or not you can keep your home will depend upon how far behind you are on your mortgage as well as the mortgage company's willingness to work with you. In a Chapter 7 Bankruptcy, you may be able to reaffirm (agree to not discharge the mortgage in bankruptcy) the mortgage so long as you can work out an acceptable plan for immediately re-paying the mortgage or otherwise reach an acceptable modification of your mortgage. (11 U.S.C. sec. 524(c)). If you are too far behind and do not have the ability to bring your mortgage current within a reasonable time, all a Chapter 7 Bankruptcy will do is buy you some time to figure out your options once the mortgage company does eventually foreclose on your home.

 

A Chapter 13 Bankruptcy will allow you a longer period of 3 to 5 years to pay the arrears on your mortgage but if you are far behind on your mortgage and the value of your home is well below the total amount you owe on your mortgage, it may be a wise decision to allow your home to go back to the mortgage company and then find a more affordable option, rent until your credit improves following your bankruptcy or lease to own.  Bottom line, whether or not you are able to save your home from foreclosure will depend primarily on how far you are behind and your ability to pay off the arrears in the allotted time (quickly in Chapter 7 and within 3 to 5 years in Chapter 13) while still making the regular mortgage payments.