How will a bankruptcy affect my mortgage? 26 Answers as of June 17, 2011

Nothing. Secured debts remain a lien on property, so if you want to keep the property, you have to continue to pay the mortgage.

Generally secured debts such as mortgages and car loans are unaffected by bankruptcy.

Keep on paying it and pay off your home, however, your attorney must assess the amount of equity in the home, which impacts upon preservation of assets in chapter 7 or payment totals in chapter 13.

You can reaffirm your mortgage even if you file BK.

Nothing, just keep paying it.

What happens will depend on you. If you continue to make payments on your mortgage then the mortgage company will have no reason to foreclose. Hopefully you have equity in your home, but the equity is not so large that your exemptions will not be enough to protect all of the equity. If your exemptions are large enough then there is no reason you should not be able to keep your home. If your exemptions are not large enough then you may have to make a "deal" with your Bankruptcy Trustee to purchase back some of your equity.

This question depends whether or not you are current with the obligation and whether or not you desire to keep the property. So long as your current with your payments to the lender the bankruptcy should not have any impact on your loan.

Technically, your legal obligation to pay the lender is discharged, BUT the lender's right to take your house remains. As long as you continue to pay as agreed, the lender cannot take your home. Should you stop paying sometime after the bankruptcy, the lender cannot sue you for a deficiency, it is limited to foreclosing on the home.

If you want to keep the mortgage, you can "reaffirm" it through the bankruptcy and continue to pay it as you have. You will only be able to reaffirm it if the equity you have in the home is protected by applicable bankruptcy exemptions.

A bankruptcy does not necessarily affect your mortgage. The actual lien against the property remains, and will "ride through" the bankruptcy unaffected. So to keep the property, you will need to continue to pay the mortgage. If you file a Chapter 7 bankruptcy, the debt that is secured by the mortgage is discharged or cancelled. You may or may not wish to enter into a "Reaffirmation Agreement" whereby you agree to be personally liable for the debt after the bankruptcy. Most mortgage companies don't care whether or not you reaffirm their debt, so long as you continue to pay. However, many of my clients find that it is easier to deal with their mortgage company after the bankruptcy if they reaffirm their mortgage debt. The mortgage companies are concerned that they will violate the automatic stay or the discharge injunction if they send you bills or contact you about the mortgage, unless you reaffirm. Many will not report your timely payments to the credit bureaus, or work with you concerning the loan, if you do not reaffirm. That being said, I would not advise a client to reaffirm a mortgage debt that is "underwater," i.e. if the house is worth less than what they owe. In your circumstances, you likely have significant equity in your house, such that you could sell it if you had to, and pay off the mortgage and have money left over.

As long as you can keep paying your mortgage, you can generally keep your house. You will need to look into whether or not you have so much equity in your house, that there is a problem with how much you can exempt, so I would suggest that you consult with a bankruptcy attorney to see exactly what options are open for you and what is the best decision for you.

Your problem is not your mortgage, the problem is your house. Each state has its own rules on whether you can file bankruptcy and keep your house. Some states have great protection, some don't. Some states, like Virginia where I am, give much better protection to married couples. You really need to talk to a good bankruptcy lawyer, and soon.

Nothing so long as you keep paying for it.

If your mortgage is current, you can keep paying it. However, you need to run by an attorney your home valuation v. your state homestead. This is a serious issue. I recommend you talk to an attorney.

If you want to keep the house, you will be required to continue to pay it.

Nothing.... just keep making payments and nothing will change. The mortgage is a secured debt not affected by Chapter 7. You must be able to exempt the equity in the home and make sure you can do that before filing.

If you continue to make your regular mortgage payment nothing will change.

After you file for bankruptcy, you may continue to retain your home and pay on your mortgage so long as you are below the allowable exemption limits for your state.

Simply keep paying it and if can protect equity in home no problem.

You are no longer legally obligated to pay the mortgage. However the lien of the mortgage holder remains and if you do not continue to make the payments, they can foreclose. If you are current on the loan when you file and stay current, most mortgage holders will allow you to continue making payments and when paid in full, will release the mortgage.

Maybe nothing at all. There is no way to know without a lawyer seeing all your financial information.