Home Foreclosure And Bankruptcy In Lewisville, TX

Chapter 13 Bankruptcy: Stop Home Foreclosure and Keep Your House

Filing for Chapter 13 bankruptcy usually takes longer than Chapter 7, about three to five years. This kind of bankruptcy allows you to submit a payment plan to the court to repay a portion of your debt. Like Chapter 7, filing also puts in place an automatic stay. At the end of Chapter 13, the rest of your unpaid and unsecured debt is discharged. Paying your missed mortgage payments will be included in your repayment plan, which can allow you to pay back the arrears you owe and get current on your mortgage again.

At the end of Chapter 13, your mortgage will not be discharged (because it is a secured debt, not an unsecured debt), but you will no longer be behind on your payments. All of your other unsecured debts will be discharged. This means you will be in a more financially stable situation and better able to stay current with the loan payments to avoid more foreclosure actions.

What is a Reaffirmation Agreement in Bankruptcy?

If you want to keep your house and save it from foreclosure by filing Chapter 7 or Chapter 13, you may have the option to sign a “Reaffirmation Agreement” if paying your mortgage would not pose a financial burden. If you reaffirm, you are letting the lender know you intend to pay the mortgage. However, if you are delinquent in your mortgage payments, your lender may not give you the opportunity to reaffirm this debt.

By signing the agreement, you become personally liable for the mortgage debt and cannot walk away from your payments after bankruptcy. To keep your home by reaffirming the debt, you must stick to the terms of the agreement. If you qualify to sign a reaffirmation agreement, your bankruptcy attorney may be able to help you negotiate the terms of your home loan to reduce the payment, interest rate and total amount owed. Also through a reaffirmation agreement, your lender can actually help you rebuild your credit by reporting your on-time payments to the credit bureaus.

What is the Texas Homestead Exemption?

You may be able to exempt the value of your home in bankruptcy under the Texas Homestead Exemption. To qualify, your house must meet the following guidelines:



• It is an urban homestead located in a city or town that does not exceed ten acres
• It is a rural homestead that does not exceed 100 acres, or 200 acres if occupied by a family
• It is real property that serves as your primary residence
• Swimming pools, barns and other fixed property items are included as part of your homestead
• You have owned the property for a minimum of 1,215 days (about 40 months or a little over 3 and a half years) before filing – also known as the domicile or residency requirement
• Other necessary homestead qualifications may apply to your case

Texas allows you to either use the state’s homestead exemption or the federal homestead exemption – but not both state and federal exemptions. Federal homestead exemptions have different qualifications, which may or may not be more beneficial to your filing. Speak with a local bankruptcy lawyer to learn if you should use Texas or federal exemptions in your filing.

Can I Refinance My House Mortgage ?

Even if you choose to reaffirm your mortgage or use a homestead exemption, you may benefit from refinancing or modifying your current mortgage loan. Some types of home loans and lenders do have time limits as to when they will approve a refinance or modification after bankruptcy. Those who choose to file Chapter 13 may have the ability to refinance their home loans during bankruptcy with court approval.

However, with a recent bankruptcy on your credit report, make sure the loan terms and interest rate is better, not worse than, your current loan. An attorney may be able to help negotiate with lenders on your behalf to find satisfactory loan terms and an interest rate that fits into your budget.

Through bankruptcy, your unsecured debts, like credit cards and your medical bills, will receive a discharge. This can help free up money you can put towards your owed and future loan payments. An experienced bankruptcy lawyer can help you through the entire process and will fight for your rights against creditors, lenders and in bankruptcy court. Our foreclosure attorneys near Dallas can guide you through what it means to reaffirm a debt, explain if you qualify for the Texas homestead exemption and your ability to refinance or modify your home loan after (or during) bankruptcy.

Contact Our Lewisville Foreclosure Attorneys to Learn If Filing Right for You

Learn how you can stop foreclosure and tackle your mortgage problem head-on through Chapter 7 bankruptcy, Chapter 13 bankruptcy or bankruptcy alternatives such as refinancing your mortgage. Schedule a face-to-face initial consultation by calling 972-315-6222 or sending a confidential attorney review form to the Denton County law office of Shuster Law Firm PLLC We are happy to meet with clients from Tarrant County, Collin County as well as residents of any of the surrounding North Texas cities needing legal help to get their finances back under control.