People often assume that when you file for bankruptcy, you lose everything including your house. But depending on which form of bankruptcy you file and where you live in the United States, this may not always be the case. If you’re fortunate enough to live here in Wisconsin, as many of our readers probably do, then there is one program that may be worth checking out if you want to keep your home during the bankruptcy process.

Some of our Milwaukee County readers may know which program we are talking about; but for those who don’t, we’re referring to the Chapter 13 Mortgage Modification Mediation Program in the Western District, also called MMMWD for short. This program not only gives Wisconsin residents the chance to reduce their debt through bankruptcy but may allow them to modify their mortgage and keep their home as well.

Unlike Chapter 7, which is what most people imagine when they think of bankruptcy, Chapter 13 gives debtors the opportunity to restructure their debt and pay it back over time. Often called the wage earner’s plan, this form of bankruptcy is designed for people who have a steady income but are simply unable to make payments in the amount a lender is asking.

Working on the principle of paying back the debt, the MMMWD sets up a meeting between a homeowner and their lender. With the help of a mediator, both parties may come to an agreement regarding payments toward the home, which may result in a mortgage modification.

It’s important to point out that a debtor must meet certain state requirements to qualify for the program. There is also no guarantee that a lender will agree to modify a mortgage either. This is something we hope our readers will keep in mind, especially if they are considering this program as part of their bankruptcy plan.

Source: Western District of Wisconsin Bankruptcy Court, “Chapter 13 Mortgage Modification Mediation Program in the Western District (MMMWD),” Accessed Aug. 14, 2014