If our income is low can we still file for chapter 13 bankruptcy and save our home from foreclosure?

Filing for chapter 13 bankruptcy could allow you to keep your home, even if you face foreclosure at the moment. However, to qualify for this chapter, you must show the court that you can afford to pay back your creditors. While your income must be high enough to make your payments on time, it cannot be too high or your case will be denied. In general, as long as you can afford to keep up with your payment plan for the next three to five years, you should be able to file for chapter 13 bankruptcy.

This is the chapter used by debtors with a steady income, since you and your lawyer will put together a plan to repay your creditors. Your income does not need to be particularly high, as long as it is steady. In fact, having a high income may prevent you from filing for bankruptcy in the first place since the judge will claim that you can pay your bills without getting them reduced.

This is also the chapter used by those who want to save their home from foreclosure. First of all, filing creates an automatic stay, which temporarily stops creditors from calling or threatening you. This puts a stop to foreclosure proceedings, too, at least until the bankruptcy has been closed. During this time, you can either save or borrow money to make your late mortgage payments. Once the automatic stay is over and the bankruptcy is complete, you should be able to keep your house since chapter 13 allows you to keep many assets, such as a home and car. This is likely the best way to save your home from foreclosure.