What happens to my mortgage in Chapter 13 Bankruptcy?

In California, mortgage debt is treated differently in Chapter 13 Bankruptcy than other forms of debt. With Chapter 13 Bankruptcy, debtors must repay a portion of their debts in a repayment plan over a period of three to five years. Under this plan, the debtor will continue to make their regular monthly mortgage payments. If the debtor is behind on their payments, the past-due payments will be rolled into their repayment plan. The debtor must then make their regular monthly payments and additional payments to their repayment plan. This ensures that their mortgage is paid off at the end of the repayment period. Also, instead of trying to catch up on delinquent payments, debtors can use the reorganization of their debt to reduce their interest rate and monthly payments. This is known as loan modification. The bankruptcy court can order the mortgage lender to modify the loan and lower the debtors monthly payments. Finally, a Chapter 13 Bankruptcy eliminates the risk of foreclosure since delinquent payments are caught up in the repayment plan. With a Chapter 13 Bankruptcy, debtors can avoid foreclosure, keep their home, and become current on their mortgage payments. Overall, Chapter 13 Bankruptcy can be a powerful tool to help debtors avoid foreclosure and get on track with their mortgage loan. It can help them reduce their monthly payments, catch up on delinquent payments, and get their finances back on track.

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What happens to my mortgage in Chapter 13 Bankruptcy?

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