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The main thing you need to really understand is it depends all on the type of bankruptcy you are going to try and file. Lets say you have a lot of debt that you can’t handle beyond the mortgage. You want to get rid of all of that debt too. You, at that point you go and file for a Chapter 7 bankruptcy which is also known as the Liquidation bankruptcy.

This Chapter 7 Bankruptcy will liquidate all of your assets and then giving all of the money gotten by selling them to your creditors. So at very best you will just delay the selling of your home with a Chapter 7 Bankruptcy anywhere from 1 month to 4 months. This is not a good option if you are trying to keep your home.

On the other hand lets say you are a 3 to 5 months behind on the mortgage payments and the interest fees, late charges and all the other fees you are getting are to much for you the average Joe to get paid back so the loan is current again and you don’t want to lose your home.

Then Chapter 13 Bankruptcy might be a better option for you. You see a Chapter 13 Bankruptcy or also known as the personal reorganization bankruptcy. Is made to be different then the Chapter 7 Bankruptcy. With Chapter 7 Bankruptcy you will be able to settle your debts fairly quickly, like 3 to 4 months. A Chapter 13 on the other hand will lay out a plan for about 3 to 5 years to give you a fresh start.

When you file for a Chapter 13, you need to make sure you are honest and open with any and all debt that you have. Which includes credit cards, loans, student loans, car loans, all of it. They will at that point set up a monthly payment plan. The natural thing to do is try to pay it off as soon as possible, which would be good if you can make the payments.

The main idea of this is to show the court that you can be faithful in your payments throughout this time. So it would be in your best interest to try to get the monthly payments as low a possible. Even if it means that you need to opt for the 5 year payment plan. The last thing that you want to do is not have the ability to pay any of the monthly payments because if you do, you could end up losing the house anyway.

Once you’re done with you 3 to 5 year plan you will be able to start over. Once you’re done all debt that you owe will be gone and it will be time to start your financial life over with a clean slate.

So lets recap everything we talked about here. If you are behind on a mortgage anywhere between 3 to 5 months and you don’t have the money to bring the loan current and you feel that bankruptcy is in your future then Chapter 13 maybe your best option just as long as you can make your payment plan and stay current though it all other wise you will not be able to keep your house.