1. Can I Save My Home from Foreclosure Through Chapter 13 Bankruptcy?
2. How does Chapter 13 work?
3. Do I have to appear in Court?
4. What are some other uses for Chapter 13?
5. How is Chapter 13 different from Chapter 7 Bankruptcy?

In a word, yes. A Chapter 13 Bankruptcy, if done by a competent and experienced bankruptcy attorney, is an excellent option for stopping a foreclosure proceeding commenced by a mortgage company, bank or any other creditor who holds a lien on your property.

At its core, Chapter 13 is a repayment plan that permits repayment of a mortgage arrearage over a 3 to 5 year period of time. If you have missed several mortgage payments (called an "arrearage"), and are unable to catch up in one lump sum, the mortgage holder may commence a foreclosure proceeding in state court. The foreclosure proceeding is a judicial mechanism that transfers title from you to someone else, usually the bank. From there, the bank may sell your property to recoup its debt. If a Chapter 13 Bankruptcy is filed prior to losing title to the property, the owner can repay the arrearage through a Chapter 13 Plan. When the petition is filed, an Automatic Stay is put in place that prevents all creditors from commencing or continuing actions to collect money, including foreclosure proceedings. While foreclosure proceeding is "stayed", you can propose a plan of repayment to the Bankruptcy Court. This plan of repayment can be no longer than 5 years. Beginning the first month after the bankruptcy petition is filed, you must begin making normal monthly payments to the bank or mortgage company, and you must continue to make them throughout the term of the plan and after the plan is finished. The mortgage company calculates the arrearage and a statement filed with the Bankruptcy Court. Beginning 30 days after your petition is filed, payments are made to a Chapter 13 Trustee. Once the Plan is approved (called "Confirmed") by the Court, the Chapter 13 Trustee begins making payments to the creditors, including the mortgage company toward the arrearage. At the conclusion of the Plan, the arrearage is paid (called "cured") and the foreclosure proceeding will then be withdrawn because the arrearage has been paid

Yes. Two trips to the Court are required of all Chapter 13 filers, unless the Court, usually for health reasons, excuses them. The first of the trips is to meet with the Chapter 13 Trustee at what is called a "Meeting of Creditors" or "341 Hearing" named after the Bankruptcy Code section that indicates that such a meeting must be held. Although it is called a Meeting of Creditors, most often no creditors are present. A typical 341 Hearing is attended only by the filers (called "Debtors"), the Chapter 13 Trustee or a representative from her office, and the attorney for the Debtors. The Trustee will review the petition and plan with Debtors and their counsel and identify issues that may arise during the case. No decisions are made at this hearing. Later in the proceeding, the Debtors must appear before the Bankruptcy Judge so that the Plan may be confirmed.

Chapter 13 Bankruptcy has several other uses; the most popular of those is paying back state and federal income taxes. Chapter 13 is very effective in this regard, as most income taxes can be paid back in 5 years at 0% interest!

The biggest difference is that a Chapter 7 bankruptcy does not provide for the repayment of any debt. Chapter 7 cannot prevent a bank or mortgage company from foreclosing on property. It may temporarily delay the proceeding for a matter of 2 - 3 weeks, but it cannot provide the long-term protection of Chapter 13 because no plan of repayment is proposed by the Debtors.