I Live In Dallas, Texas. Can I Keep My Home Through A Bankruptcy?

One question that haunts most people who file for bankruptcy is whether they will be able to keep their homes or lose them in the bankruptcy process. There is no clear answer to this question, but people living Dallas, Texas should know that the state’s bankruptcy laws exempt any equity a bankruptcy petitioner may have in their home.

This means that if you are able to continue making payments on your mortgage, you are allowed to keep your home.

Also, by filing a Chapter 13 Bankruptcy, you are eligible to make a repayment plan over a period of 3 to 5 years. If you hire Dallas bankruptcy attorneys Allmand and Lee to file Chapter 13 on your behalf, you will be able to keep your home.

Unfortunately, many people wait until it is too late to file Chapter 13. If you are already several months behind in making your mortgage payments and have no reason to believe that your situation will change, contact usimmediately.

Effect of a Discharged Bankruptcy on Your Mortgage

Although a bankruptcy discharge does absolve you of your personal liabilities with respect to the mortgage on your home, it does nothing to the lien itself. Effectively, this translates to the lender’s rights in the mortgage being protected, which includes the right to foreclose on the property if the terms of the mortgage agreement are breached.

You should understand that although filing for bankruptcy or getting a discharge is not a breach of the mortgage agreement, non-payment of the loan certainly is.

Should You Keep Your House?

Although filing for Chapter 13 does allow you to keep your home, in every case it may not be a wise decision. Like many other consumers, you may have also taken out home equity loans, making the amount due on your mortgage equal to or greater than the value of your home, such that the entire value of the property is pledged to the lender.

If this is the case, depending on your particular financial situation, it may not be such a good idea to retain your house; it may be best to make a fresh start by walking away from a property that may be more of a burden than an asset.

Negotiating With Your Lender May Be the Right Step

When you file a Chapter 7 bankruptcy, are late with payments and liable for foreclosure, the filing just delays the foreclosure, but does not kill the rights of the lender in the property and they can foreclose if payment is not made.

To keep your home, you will need to make arrangements with your lender.

When you put up your home as collateral against loans other than your mortgage, the other creditors also have surviving liens (claims) on the property with the right to foreclose if payment is not made.

Sometimes, it is best to negotiate with your lender. Most lenders are open to negotiations - subject to the state of your credit history, your future financial prospects and the reasons why you missed on your payments.

However, if you are not able to negotiate successfully with your lender, bankruptcy may be your only option. Again, if you are in this situation, then time is of the essence – you should not wait until foreclosure is imminent.

Dallas bankruptcy attorneys Allmand and Lee have helped hundreds of clients keep their homes through foreclosure. We have amassed 20 years of combined experience and pride ourselves on helping our clients on the road back to financial solvency.

If you are behind in your mortgage payments, or even if foreclosure proceedings have started against you, there is still hope.