Q: I am wondering if I can declare bankruptcy on the loan against my house?
A:
If you file a petition for relief under the bankruptcy code, you must list all creditors. Your question does not tell us what you want to do about the house mortgage.
If you want to walk away from the house and not owe the the debt, then you can discharge the debt which is secured by your home. The bank will be allowed to foreclose at some point, but the bank will not be able to sue you for the deficiency. The foreclosure will show on your credit report, and the debt will show that the debt was included in the bankruptcy discharge with a $0.00 balance.
If you want to keep the home, then you will be required to continue to pay the mortgage payments and bring the loan current if you file a chapter 7. If you file a chapter 13, you will be able to bring the arrears current over a period of 3 to 5 years, but you must make all future house notes.
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