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What Debts are Included in a Bankruptcy?

Posted by attorney Kelly Zinser

All of your debts are included in the bankruptcy, but some of them are treated a little different than the others. The bankruptcy removes any personal liability you have for the mortgage accounts. The lender still has a lien against the property, but their only option if you fall behind on the payments is to foreclose. They cannot sue you for any deficiency or take any other actions against you personally.

As long as you keep making the payments on time, you can keep the house just as you did before the bankruptcy. The only difference now is what the lender can do if you can’t make the payments and fall behind. Most lenders will not report your payments (on-time or late) to the credit reporting agencies after the bankruptcy. However, you can keep records or copies of your payments and send the information in to the reporting agencies to make sure the on-time payments are shown.

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