How does a Chapter 13 Bankruptcy stop foreclosure?

In Washington, Chapter 13 Bankruptcy Law allows someone who is facing foreclosure to stop the process if they are able to establish and follow a repayment plan. The borrower must file a petition with the court to begin the process and will then need to create and submit a repayment plan to the court for approval. The repayment plan will outline how much of the debt will be paid off and how the payments will be made. Once the repayment plan is accepted by the court, the lender must suspend foreclosure proceedings and wait for the repayment plan to be completed. As long as the borrower sticks to the repayment plan and continues to make their mortgage payments, the lender will not be able to foreclose on the property. This gives the borrower valuable time to get their finances in order and make other arrangements if needed. One important factor to remember when filing for Chapter 13 Bankruptcy is that it will remain on the borrower’s credit score for seven years. This can have an effect on their ability to get credit in the future, so it should be explored if other alternatives are available. Despite this, Chapter 13 Bankruptcy is a powerful tool for someone facing foreclosure in Washington, allowing them to keep their home and repay their debts over time.

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How does a Chapter 13 Bankruptcy stop foreclosure?

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