People file for bankruptcy for a lot of different reasons, including credit card debt, unexpected medical bills, failed business ventures and more. One of the most common reasons for Chapter 13 bankruptcy, though, is because people are trying to stop foreclosure and save their homes.
Chapter 13 can help if your home is being foreclosed on in a few ways. First off, it's generally going to put an automatic stay on the foreclosure lawsuit being carried out by the lender. That suit has to wait for the bankruptcy lawsuit to conclude. It can take months for that to happen, so, at the very least, you get a few more months in your house while everything goes through the court.