Filing bankruptcy stops creditors' collections against you immediately. But sometimes a creditor tries to get permission to collect anyway.
Here are 3 more scenarios for when you are current on your mortgage, where Chapter 7 works well in dealing with other home-related debts.
Here's an example why to keep an open mind about filing under Chapter 7 vs. Chapter 13. Slightly different facts can make all the difference.
Filing a Chapter 7 case stops foreclosure of your home temporarily, helping you gather funds for your transition to your next housing.
Chapter 7 buys you the crucial time you need in many situations when falling behind in your obligations related to your vehicle or your home.
If you are behind on your mortgage, and are thinking of selling your home, you can often delay selling for many months or even for years.
Filing a Chapter 13 case buys you time and flexibility for catching up on your mortgage arrearage. Lots more of both than in Chapter 7.
Filing a Chapter 7 bankruptcy case stops a foreclosure and buys some time to either arrange to keep the home or move in a peaceful way.
If you've fallen behind on your mortgage, it's very hard to catch up. It may even seem impossible. Chapter 13 makes it possible.
Here's an example of how Chapter 13 can allow you to hold onto your home but then change your mind about it later.
As you decide whether to use the powerful tools of Chapter 13 to hold onto your home, it helps to know that you can later change your mind.
If your home is exposed to your creditors and to the Chapter 7 trustee because it has too much equity, Chapter 13 can protect that equity.
If your home is at risk because you have more equity than the amount of the homestead exemption, Chapter 7 might still save your home.
Chapter 7 doesn't wipe away "statutory liens." But Chapter 13 gives you a safe and flexible way to deal with them.
If you are behind on property taxes on your home, Chapter 7 often doesn't give you enough time to catch up. But Chapter 13 likely would.