One of the main fears when filing for bankruptcy is that it will not be possible to preserve any of your assets. This is true for Chapter 7 bankruptcy in Pennsylvania. In Chapter 7, you do not liquidate your assets. Instead, the court provides you with the opportunity to pay your debts off. You receive a payment plan that takes into consideration your disposable income and the debts that you have. In counting your debts, naturally you may consider the safety of your home. Can you keep your residence?
According to Forbes, your home is one of your major assets that you may keep through Chapter 13 bankruptcy. What homeowners have to take into consideration is that they must remain current on their mortgage while paying off their repayment plan. If you are in the middle of a foreclosure, bankruptcy may allow you to put a temporary stay on the foreclosure. However, this will not last forever. You can keep the stay as long as you remain in solid standing with your creditors and with the bank who owns your home.
As long as you continue to make payments on your repayment plan and as long as you continue to pay your mortgage, you will not lose your home. However, when you miss a mortgage payment, the hold disappears. This means that after one missed payment, creditors can collect on the debt. Your home is no longer a safe asset.
This information provided here is for general knowledge about Chapter 13 bankruptcy and personal residences. It is not legal advice.