A Chapter 7 bankruptcy filing will stop a foreclosure because a filing will trigger the imposition of the automatic bankruptcy stay.   Of course, Chapter 7 does not function as a repayment plan like Chapter 13 so Chapter 7 does not provide for a repayment of missed mortgage payments over time like Chapter 13 does.

It does not matter that your Chapter 7 “Statement of Intention” provides that you intend to surrender your home.  Your Chapter 7 filing will create an automatic stay and legally bar a mortgage or judgment creditor from proceeding with a foreclosure sale.

In rare cases, Chapter 7 does serve to give debtors time to catch up their payments or proceed with a refinance or even a sale.

Occasionally we meet with clients who have filed Chapter 7 cases on their own, without the advice of an attorney, or using a petition preparation service.  This is usually not a good idea as Chapter 7 cases cannot be dismissed voluntarily once they have been filed – instead any motion to dismiss a Chapter 7 must be heard by the judge and approved.  In cases where there is equity in a home over the outstanding mortgage the judge may not agree to a voluntarily dismissal and the trustee will take possession of the home to sell it.   For this reason, Clark & Washington recommends that you never file a Chapter 7 pro se (on your own, without the help of a lawyer) or using a non-lawyer petition preparation service.