How to Keep Your Home If Your File Chapter 7 Bankruptcy
- 1). Obtain a petition for bankruptcy and related forms from the clerk of the bankruptcy court. In addition to obtaining the documents necessary to file bankruptcy directly from the clerk's office, you can usually download them from the bankruptcy court's website.
- 2). Fill out the Chapter 7 bankruptcy petition and related forms. In the exemption section of the petition, list your home. Make note that your home is exempt in the bankruptcy proceedings because it is homestead property. Identifying your home as exempt will protect it from all creditors except for the home mortgage lender.
- 3). Write to the home mortgage lender following filing for bankruptcy. Advise the home mortgage lender that you desire to enter into a reaffirmation agreement. A reaffirmation agreement is quite like a home loan modification. It is an agreement between you and the lender that permits you to maintain ownership of your home provided you make mortgage payment under a new schedule as set forth in the reaffirmation agreement.
- 4). Sign the reaffirmation agreement. The signing of the reaffirmation agreement normally occurs during the creditor's meeting held before the bankruptcy trustee. Once executed, the reaffirmation agreement is provided to the bankruptcy trustee who files it with the clerk of the bankruptcy court. the reaffirmation agreement becomes a part of the final order of the bankruptcy court in your case.