Filing bankruptcy before foreclosure may allow a person to stop foreclosure proceedings before they even begin.
If the bank has already started taking action, filing bankruptcy after the foreclosure papers roll in may help stop proceedings in their tracks.
Many people file bankruptcy after a foreclosure. Under Chapter 7, foreclosure may be delayed for a few months. Under Chapter 13, filers may be able to stop foreclosure altogether and save their homes.
To learn more about bankruptcy’s ability to stop foreclosure, fill out the free bankruptcy evaluation form below. Each situation is unique. Ask a local attorney bankruptcy questions about your specific situation:
When people file for Chapter 13 bankruptcy, they work in tandem with their creditors and the bankruptcy court to create a new payment plan for their debts. This plan often includes home mortgage loans.
In Chapter 13, bankruptcy filers are given an extended period of time to catch up on their overdue mortgage payments. During this process, a home foreclosure may be avoided if:
Thus, filing for Chapter 13 bankruptcy after foreclosure may allow people to save their homes from aggressive lenders.
If a filer goes through Chapter 7 bankruptcy before foreclosure, he or she might shed some unsecured debts, freeing up money for mortgage payments. This could potentially prevent foreclosure from happening.
Filing for Chapter 7 after foreclosure may also provide some benefits, including:
The question of whether people should file bankruptcy before or after foreclosure depends on several different factors.
Contact a local bankruptcy attorney today to discuss your unique situation.