Legal Question in Bankruptcy in Pennsylvania

My firm provides a free initial consult, but I am not aware of any who offer a free bankruptcy.

There are generally two types of bankruptcies for consumers, Chapter 7 and 13. The former is generally for those who simply require the elimination of unsecured debt such as credit cards. The latter is generally for those who have fallen behind in secured debt such as a mortgage. Chapter 13 allows you to repay any arrears over five years.

The filing of a bankruptcy creates what is known as an automatic stay. That stops all attempts to collect a debt, including lawsuits and sales. The purpose of the stay is to give you breathing room so that you have an opportunity to cure the default.

However, a 13 will also require that you resume payments to the mortgage companies. The fact is that all laws require that payments be made to a mortgage company or they may foreclose.

So, you have 4 options: 1) sell 2) refinance the mortgage or modify the loan 3) chapter 13 4) remain in the home as long as you can rent and mortgage free with the understanding that you will have to move at some point.

You should speak with experienced bankruptcy counsel to discuss all the ramifications.

I trust this has been helpful, but feel free to call or e-mail on a free initial basis.