In Foreclosure and Bankruptcy, the legal proceedings are started by “mortgagee”. While filing for a bankruptcy, it can help a homeowner to avoid foreclosure. A Chapter 7 bankruptcy can stop foreclosure. In a foreclosure action when legal papers are served against the homeowner there is a little amount of time left for him/her to save the home. A Chapter 13 Bankruptcy would permit us to keep our home while repaying our mortgage arrears over a three to five year period, generally with no interest accumulating on the arrears during the repayment period.