Many people are concerned how their mortgage loan is affected if forced into a bankruptcy and when someone experiences financial crisis like job loss, medical crisis or business failure, it can become quite difficult for them to repay  all of their existing loans or debts. Filing bankruptcy may seem to be a viable option in order to get rid of these debts, but you should know it may become difficult to qualify for a new mortgage.  At least right away.  You should also know that your existing mortgage gets affected when you file bankruptcy.

What happens to your existing mortgage after bankruptcy filing?

When you need to declare bankruptcy, you usually will want to file either chapter 7 or chapter 13.  However, the consequences of filing chapter 7 are different from that of chapter 13.  The effects on your existing mortgage after filing bankruptcy are discussed below.