It depends on the type of bankruptcy that is filed and the specific circumstances of the homeowner’s situation. In a Chapter 7 bankruptcy, the homeowner’s assets, including their home, may be liquidated to pay off creditors. However, in a Chapter 13 bankruptcy, the homeowner may be able to keep their home by entering into a repayment plan to pay off their debts over a period of 3-5 years. Additionally, some states have laws that provide extra protection for homeowners facing foreclosure, such as the right to redeem the property or reinstate the loan. It is important to consult with an attorney familiar with bankruptcy and foreclosure laws in your state to determine the best course of action.
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