Can I Keep My House in Chapter 13 If I'm Behind on the Mortgage?
- Sheereen E. McNair, Esq.
- Jul 19
- 4 min read
Updated: Jul 22
Yes. If you are behind on your mortgage and you want to keep the house, Chapter 13 is usually the way to do it. Filing stops the foreclosure immediately. Then your repayment plan spreads the missed payments, the arrears, across three to five years, while you resume the regular monthly mortgage payment going forward. You do not have to come up with the past due amount in a lump sum. As long as you make both payments, the plan payment and the ongoing mortgage payment, the lender cannot foreclose and the house stays yours.
What Curing the Arrears Actually Means
Arrears are simply the payments you missed, plus the late fees and costs the lender tacked on. In a Chapter 13 case you do not pay that off all at once. You pay it through the plan, in monthly installments, over the life of the case.
Say you are eight months behind and the arrears total $18,000. In a five year plan, that is roughly $300 a month added to your plan payment, plus the trustee's percentage. That is a number most people can actually live with. A lender demanding $18,000 by Friday is not.
The Bankruptcy Code is what makes this possible. It lets a Chapter 13 filer cure a default on a home mortgage and keep making the regular payments, and the lender has to accept it.
The Two Payments You Have to Make
This is the part people misunderstand, so it is worth being blunt about it.
Payment one: the ongoing mortgage. Starting with the first payment that comes due after you file, you pay the regular monthly mortgage. Depending on the plan structure, that either goes straight to the lender or through the trustee. Nothing about your interest rate, principal, or term changes.
Payment two: the plan payment. This goes to the Chapter 13 trustee every month. It carries the arrears, plus whatever else the plan has to pay, like car loans, priority taxes, and attorney fees.
Both payments have to happen, every month, on time. Chapter 13 does not pause your mortgage. It gives you a structured way to catch up on the old debt while you stay current on the new.
What Chapter 13 Will Not Do to Your Mortgage
Chapter 13 has real limits on a first mortgage secured only by your home. It generally cannot:
Lower your interest rate
Reduce the principal balance to what the house is worth
Stretch the mortgage term out
Erase the mortgage lien
It cures the default. It does not rewrite the loan. If the monthly mortgage payment was never affordable to begin with, Chapter 13 will not fix that, and an honest lawyer will tell you so before you file rather than after.
There is one narrow exception worth asking about: a wholly unsecured second mortgage or HELOC, meaning the first mortgage alone already exceeds the value of the home, can sometimes be stripped off and treated as unsecured debt. That is fact specific and requires a valuation. Upload your payoff statements before your call and we will look.
Do I Also Need the Homestead Exemption?
Usually not, but it still matters.
Maryland protects up to $125,000 of equity in owner-occupied real estate. That figure went up on June 1, 2026, from roughly $31,000, so a lot of what you will read online about Maryland home equity is now out of date. Married couples cannot double it, and there is no special senior amount.
In Chapter 13 you are not handing property to a trustee to sell, so the exemption is not protecting the house from liquidation the way it does in Chapter 7. What it does is set the floor for what unsecured creditors must be paid. The more nonexempt equity you have, the more your plan has to pay them. With the exemption now at $125,000, a lot of Maryland homeowners who were pushed into a long, expensive Chapter 13 purely because of home equity would look at a very different case today.
If you were told a year or two ago that you had too much equity, that advice may simply no longer be correct. It is worth a second look.
What Happens If I Fall Behind During the Plan
Miss plan payments and the trustee will move to dismiss the case. Miss the ongoing mortgage payments and the lender will ask the court to lift the automatic stay so it can restart foreclosure. Either way the protection goes away.
The good news is that this is fixable if you speak up early. Plans can often be modified, payments can sometimes be suspended for a short period, and a missed mortgage payment can sometimes be worked into a cure agreement. What does not work is silence. Call your attorney the same week you know you are going to be short, not three months later.
Maryland Specifics
Maryland bankruptcy cases in the Washington suburbs are filed in the U.S. Bankruptcy Court for the District of Maryland, Greenbelt Division, at 6500 Cherrywood Lane, Suite 300, Greenbelt, MD 20770. The Chapter 13 filing fee is $313. Maryland has opted out of the federal exemption system, so you use the Maryland exemptions, not the federal set.
Maryland foreclosures move through the state court system and a sale date can arrive faster than people expect. A Chapter 13 filed before the sale stops it. Filed after the sale, your options narrow sharply. Timing is the whole game.
Reality Check
Chapter 13 is not a way to keep a house you cannot afford. It is a way to keep a house you can afford, that you simply fell behind on, after a layoff, an illness, a divorce, a stretch of bad months. If you can make the regular mortgage payment going forward and a plan payment on top of it, Chapter 13 will very likely save the house. If you cannot, we will tell you that plainly and talk about what else is on the table.
Related Questions
Behind on the Mortgage? Let's Look at the Numbers Before the Sale Date.
Schedule your free consultation with Middleton Legal, or call 240-896-3253. Maryland homeowners get honest answers, fast. Book your free consultation.
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