Refinance your way out of Chapter 13 Bankruptcy
Chapter 13 reorganizes your debt into a payment plan that allows you to pay back your creditors over the course of 3 – 5 years. At the end of your repayment period, any remaining debt is discharged. With this type of bankruptcy, you can keep your property if you continue to make payments on it. Chapter 13 bankruptcy stays on your credit report for 7 years.
With Chapter 13, FHA and VA loan borrowers may be able to refinance while they are still in bankruptcy, after they have made a year of on-time payments according to their repayment plan.
Discharge on a Chapter 13 bankruptcy comes after you have completed your repayment plan, which also takes a few years. Discharge means that the bankruptcy has been completed and your unpaid debts are written off. Chapter 13 discharge happens once your repayment plan is completed, which takes between 3 – 5 years.