Submitted by Attorney James McGuire

Can I file bankruptcy if I am behind on my house payments?

Clients often wonder whether they can file bankruptcy if they are behind on their house payments.  The short answer is yes.  However, which type of bankruptcy is best in your situation needs to be discussed with your attorney.

For example, if your goal is to keep your home, a Chapter 13 bankruptcy may be the best fit for you.  In Chapter 13, you are allowed to resume (or continue) making the regular monthly payments, while making a Chapter 13 “plan payment”, a portion of which will be used to cure the arrearage on your home over a period of 3 to 5 years.  This works best when the reason you have fallen behind on your house payments was a temporary problem, and you are able to get back on track but need time to do so. 

If you do not want to keep the house, then Chapter 7 bankruptcy may be a better option.  You can surrender the home to the bank as part of the Chapter 7 bankruptcy and discharge the mortgage, including any arrearage. 

Increasingly, we are seeing banks reluctant to immediately foreclose on homes that clients wish to surrender in Chapter 7.  With more frequency, banks are now reaching out to these clients to see if they would like to pursue home modifications or other strategies to help them stay in their home.  If it works out, great, if not, you can ignore such offers and discharge the mortgage with the surrender of the home.

If you are behind on your mortgage and considering bankruptcy, it is a good idea to talk to a bankruptcy attorney that can assess your individual goals and situation.

If you have questions about bankruptcy, we encourage you to attend one of our free seminars or contact us at 800-899-2730 for a free personalized consultation. For more information about our seminars please visit