Bankruptcy
If you're facing foreclosure and struggling with unsustainable debt beyond your mortgage, declaring bankruptcy may be the best option for you to temporarily stop the process. Bankruptcy is a common strategy for homeowners in this situation to avoid foreclosure and give themselves some breathing room.
It's important to note that while your home is in bankruptcy (Ch 7 & 13), it cannot be sold or foreclosed on. However, if you're behind on loan payments, the lender may file a motion with the bankruptcy court to have the bankruptcy stay on your home lifted. If this happens, the stay will be lifted and your home will go back into foreclosure and could potentially be auctioned.
While bankruptcy can provide temporary relief from the stress of foreclosure, it's not a long-term solution. If you're facing this difficult situation, it's important to work with professionals who can help guide you through the process and explore all of your options. Contact us today to learn more.
Advantages and Disadvantages
Are you considering declaring bankruptcy as a last-minute solution to stop your foreclosure? While it may temporarily halt the auction of your home, the reality is that most homeowners who declare bankruptcy still end up with both a bankruptcy and a foreclosure on their credit report. This is because bankruptcy only delays the foreclosure and doesn't prevent it, and fees and missed payments can pile up during the process, making foreclosure even more likely.
If your financial problems can be mostly resolved by selling your home, other options, such as a short sale, might be a better choice than bankruptcy. However, a bankruptcy attorney may not always tell you this. That's why it's important to talk to a creative real estate investing professional about all of your options before making any big decisions.
No matter what your situation, income, or equity may be, we're here to discuss all of your options for selling your home quickly to avoid foreclosure. Don't let bankruptcy be your only option. Contact us today to learn more.
Common Questions about Bankruptcy
Question: How and How Much?
Answer: Generally you consult with a Bankruptcy attorney and complete the paperwork and they file it with the courts. Attorneys charge different fees for this. We have seen this cost around $2000 for most people (for a fairly simple bankruptcy). Complex bankruptcies will cost more. This is a specialized area of law.
Question: Does a Bankruptcy Stop Foreclosure?
Answer: Yes, but only temporarily. Bankruptcy delays a foreclosure until the lender files a motion to have the bankruptcy stay lifted. This almost always happens. During this delay, fees and missed payments pile up making foreclosure more likely and less preventable.
Question: Are there alternatives?
Answer: Yes. Contact us and we can discuss other options that might be more suitable with less damage to your life and credit.