One of the main benefits of filing for bankruptcy protection is it protects home owners from a foreclosure proceeding or foreclosure lawsuit. Once the bankruptcy petition has been filed, any foreclosure attempt is automatically stopped, or “stayed” and the homeowner can continue to live in the house, regardless of payments, until the bankruptcy process has been completed.

Once the bankruptcy has been completed, the mortgage payments will resume, usually at a much lower monthly payment, until the mortgage is reduced to zero or the homeowner sells the house. Your bankruptcy lawyer will negotiate with your mortgage loan company in order to get the lowest payment possible while allowing you to keep the house.