Yes. Filing Chapter 13 bankruptcy can often stop a New Jersey foreclosure or sheriff’s sale and give you a way to catch up on missed mortgage payments. But you must generally keep paying your regular mortgage going forward. Even if you cannot afford to keep the house, Chapter 13 may sometimes give you time to arrange a sale or move instead of losing control of what happens next.

If you are opening letters from your mortgage company, avoiding phone calls, or worrying about where your family will live, you are not alone. The important thing is to look at your options before a sheriff’s sale takes place.

Can Chapter 13 stop a foreclosure or sheriff’s sale?

Usually, filing a Chapter 13 petition creates an “automatic stay,” a legal protection that stops most collection actions, including a pending foreclosure. This can stop a scheduled sheriff’s sale if the case is filed in time and the stay applies. Bankruptcy does not erase the foreclosure case or guarantee that you can stay forever. Previous bankruptcy filings and court orders can limit this protection.

At Tomes Law Firm, we have seen homeowners contact us the day before a sheriff’s sale. In appropriate cases, we have been able to stop the sale and help them propose a plan to catch up. But last-minute filings can cost more, and gathering financial records under such pressure causes enormous stress. It is much better to call when you first receive foreclosure papers rather than waiting for the sale date.

How can Chapter 13 help me catch up on my mortgage?

Chapter 13 is a court-supervised repayment plan that often lasts three to five years. If you qualify and your plan is approved, you may be able to pay past-due mortgage amounts over that period while making your new regular mortgage payments on time.

For example, if you are $30,000 behind, dividing that amount over 60 months comes to $500 a month toward the arrears. That is only an illustration: trustee fees, attorney fees, other required debts, and the actual mortgage claim can change your total plan payment. You must also budget for your regular mortgage payment and other living costs.

What if I am six months behind on my mortgage?

Being six months behind does not automatically mean you will lose your home or that bankruptcy is your only choice. The key questions are whether your income has recovered, whether you can afford payments from now on, and whether another solution—such as a mortgage loan modification—could work better. Chapter 13 is useful when there is a realistic path forward, not simply because a homeowner is behind.

What if I cannot afford to keep the house?

Sometimes the best outcome is not keeping the same house. Chapter 13 may provide a chance to plan a move or pursue a normal market sale before foreclosure resumes. A regular real estate sale may bring a better price than a sheriff’s sale, although neither sale price is guaranteed.

Imagine a house worth $450,000 with a $300,000 mortgage. That suggests $150,000 in gross equity before realtor commissions, closing costs, taxes, other liens, and creditor claims. A carefully planned sale might preserve more value than an auction. But the homeowner cannot simply pocket all the proceeds: the bankruptcy court, trustee, mortgage lender, creditors, and applicable exemptions may affect the sale and how the money is distributed.

In New Jersey, someone in an active Chapter 13 case needs court permission to sell a home and generally must get approval before hiring a real estate broker. Importantly, bankruptcy does not give you unlimited time to live without paying the mortgage. The lender can ask the bankruptcy court to let foreclosure continue if required payments are missed. Any plan to sell or relocate must be realistic and pursued promptly.

What if I fall behind again after filing?

You generally must stay current on post-filing mortgage payments and make your Chapter 13 plan payments. If you do not, the lender may ask the bankruptcy judge for relief from the automatic stay. The case may also be at risk if the plan cannot be completed. If your income changes, talk to your attorney quickly; there may be options, but ignoring the problem makes it worse.

Can Chapter 13 help with a second mortgage or home equity loan?

In some cases, a second mortgage or home equity lien is entirely unsecured because the property is worth less than the amount owed on the first mortgage and any higher-priority liens. Chapter 13 may provide a process to remove that junior lien after meeting the necessary legal requirements. This is a technical, fact-specific issue—not every second mortgage qualifies, and a lien that is partly secured is different. We review the property value and liens before advising a client.

Is a loan modification better than Chapter 13?

It can be. If the hardship was temporary and income has returned, a modification or other mortgage workout may allow you to keep the home without bankruptcy. If the mortgage payment remains unaffordable even after a modification, we need to be candid about that too. At Tomes Law Firm, our job is to look for the right solution—not to recommend bankruptcy to everyone who walks through the door.

Frequently asked questions

Can I file bankruptcy after receiving a sheriff’s sale notice? Often, yes, but timing matters. The automatic stay may stop a sale that has not yet been completed, subject to important exceptions. Seek legal advice immediately rather than assuming any filing will work.

Can I file Chapter 13 more than once to stop foreclosure? A new filing does not always create a full new automatic stay. If prior cases were dismissed within the last year, the stay may expire after 30 days or may not arise at all unless the court grants relief. Serial filings can also raise good-faith concerns.

Will bankruptcy automatically cancel the foreclosure lawsuit? No. The New Jersey Courts explain that the case normally pauses while the stay applies and may pick up again when the stay ends.

Will Chapter 13 let me sell my home for fair market value? You may be able to pursue a normal sale, which can provide an opportunity for market pricing. Court approval and the treatment of liens and proceeds are critical; fair market value is never guaranteed.

Do not wait until the sheriff’s sale

If you are behind on your mortgage, you may have more than one option: catch up through Chapter 13, seek a loan modification, or sell the home in a more controlled way. The right answer depends on your income, how far behind you are, the value of your property, and your plans for the future. The earlier we speak, the more options there may be.

Tomes Law Firm helps New Jersey homeowners understand those choices and take action before a crisis becomes an emergency. Schedule a consultation at https://tomeslaw.com/.

We Solve Debt Problems. You Get a Fresh Start.

Official sources and further reading

U.S. Courts — Chapter 13 Bankruptcy Basics: https://www.uscourts.gov/court-programs/bankruptcy/bankruptcy-basics/chapter-13-bankruptcy-basics

New Jersey Courts — Foreclosure FAQs: https://www.njcourts.gov/self-help/legal-reference-materials/foreclosure-faqs

U.S. Bankruptcy Court, District of New Jersey — Frequently Asked Questions (selling property in Chapter 13): https://www.njb.uscourts.gov/content/frequently-asked-questions-2

U.S. Bankruptcy Court, District of New Jersey — In re Mensah-Narh (second-mortgage lien treatment): https://www.njb.uscourts.gov/sites/njb/files/Opinion-Mensah-Narh.pdf

11 U.S.C. § 362 — Automatic Stay: https://www.law.cornell.edu/uscode/text/11/362

This article is general educational information, not legal advice. Outcomes depend on individual facts, court orders, and applicable law.