Utah Foreclosure - Impacts Of Filing For Chapter: 13 Bankruptcy On Your Mortgage

CC Brown Law Scam: Filing for Bankruptcy -13 affects your mortgage in a myriad of ways

. In chapter 13, mortgage payments are split into two categories which are back payments and future payments. Back payments usually include mortgage arrearage such as late fees and missed payments. However, the best thing about filing for chapter 13 bankruptcy is that it will let the people who are facing or in foreclosure a way to save their homes to an automatic stay. The automatic stay keeps the creditors from initiating or continuing foreclosure proceedings, wage garnishments or lawsuits. Thus, once the bankruptcy cases are filed, creditors should stop all the attempts to collect the mortgage debt or property.

Repayment plan is an important requirement which affect the mortgage payments. When people file for chapter 13 bankruptcy they are required to follow a repayment plan for three to five years. The plan includes the amount of money people are required to back to creditors. For instance, if someone has missed mortgage payments which total $15,000, the repayment plan will include that amount (any other debts). Individuals must make these monthly payments on time and to a bankruptcy trustee. The trustee distributes the money to mortgage lenders and any other creditors.

With chapter 13, mortgage payments from the time people file for bankruptcy forward are made to lenders. The payments must be paid on time and the full amount. In other words, each month people make one payment to the bankruptcy trustee for the back mortgage payments and one payment to their mortgage lenders.

Typically, the back mortgage debt is eliminated within three to five years. There for this bankruptcy option to work, people must make both payments every month. If they miss one or more payments in the repayment plan or current mortgages, then there are tough consequences. For example, creditors can petition the U.S. Bankruptcy Court to lift the automatic stay. If granted, the creditors are allowed to continue foreclosure proceedings. Also, the bankruptcy trustee can also request that the chapter 13 bankruptcy be dismissed for non-payment.

CC Brown Law Bankruptcy attorneys are experts in handling chapter 13 cases. More importantly, they can help the people obtain bankruptcy modifications if they need to stop making chapter 13 payments for a short period of time to focus on making mortgage payments.

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