December 1, 2021 By:
In most instances, filing for bankruptcy won’t make a foreclosure proceeding go away, but will only suspend it. That’s because most debtors who want to try and keep their home after bankruptcy seek protection under Chapter 13, rather than Chapter 7. With a Chapter 7 filing, you can permanently discharge the debt you owe, but, in exchange for that right, you must relinquish certain property to the bankruptcy court, to be sold to satisfy your creditors.
In most states, there are significant limits on the amount of equity you can protect in your home when filing a Chapter 7 bankruptcy petition. In Texas, however, you can protect an unlimited amount of equity. Nonetheless, even if you have the debt discharged on your home, the discharge won’t extinguish the lien held by the bank on your property.
Typically, when you file for bankruptcy protection, the automatic stay goes into effect immediately, preventing creditors from initiating or continuing legal action, such as foreclosure proceedings. However, a creditor may petition the court to lift the stay with respect to your home, so that foreclosure proceedings can move forward.
At the Law Offices of Carrie Weir, all potential clients are entitled to a free initial consultation. To arrange an appointment, contact my office online or call 972-772-3083. I handle Texas personal bankruptcy filings in Kaufman County, Rockwall County, Collin County, Dallas County, Hunt County and the surrounding counties.