One of the many worries on the minds of those struggling with overwhelming debt, who may have fallen behind on mortgage payments, is saving a family home from foreclosure. Struggling consumers and homeowners facing the foreclosure process should be familiar with the potential ways personal bankruptcy protection may be able to help them.

Chapter 13 personal bankruptcy protection may be able to help with foreclosure in a couple of different ways. Chapter 13 bankruptcy is a reorganization bankruptcy option that allows the filing party to reorganize their debts so they may be repaid over a more manageable period of time. The bankruptcy court will work with the filing party to develop a repayment plan which will usually be paid over a period of 3 to 5 years. Once the repayment plan is complete, the filing party can enjoy debt relief.

Chapter 13 bankruptcy may also be able to help the filing party stop foreclosure of a family home. The automatic stay that goes into effect once bankruptcy has been filed for prevents creditors from pursuing any further creditor collection actions during the bankruptcy process. At that point, the filing party may be able to include missed mortgage payments in their repayment plan to get caught up and avoid foreclosure.

Because there is so much on the line when facing foreclosure, and the bankruptcy process can be technical, it is important to understand how bankruptcy options may help save the homeowner’s home and otherwise. Familiarity with personal bankruptcy protection in general for those seeking a fresh financial start can be beneficial.