There are a couple ways the cost gets calculated and I’ll give you an explanation of both. First, remember that the main types of bankruptcy are Chapter 7 and Chapter 13.
Foreclosure is a costly process for lenders, so many are willing to consider loan modification as a way to avoid doing so.
A loan modification is different from refinancing your mortgage. Refinancing calls for replacing the loan with a new mortgage, whereas a loan modification changes the terms of the existing loan.
There are many "chapters" of the U.S. Bankruptcy Code. The 2 chapters used by most of us to reduce the burden of debt and to put creditors under control are Chapters 7 and 13.
The good news is that overall, most people we have seen qualify for one or both. The big categories of qualification are how long since a previous bankruptcy filing, how much debt someone has, and how much income someone has.