In this section of Total Bankruptcy, you will learn about:
Mortgage foreclosures continue to crash down on Americans at an alarming rate.
Banks are calling in their mortgage notes and if you fear that you'll lose your home, you're not alone. $330 billion in adjustable rate mortgages have adjusted or will adjust upward in 2006.
By the end of 2007, more than three million homeowners will face dramatically increased mortgage payments.
If you're like most consumers, you may not know that bankruptcy may be able to help you save your home in the face of a looming foreclosure. Chapter 13 bankruptcy is a very powerful tool if you have fallen behind on your mortgage payments and want to save your home from foreclosure.
Chapter 13 bankruptcy can often stop foreclosure. In fact, stopping mortgage foreclosures is the driving force behind many Chapter 13 bankruptcies, and it can stop a mortgage foreclosure proceeding in its tracks.
However, the Chapter 13 bankruptcy must be filed before the mortgage company sells your home. The bankruptcy filing gives homeowners the time they need to cure delinquent mortgage payments.
A Chapter 13 bankruptcy plan provides for the repayment of the mortgage arrears and other secured debts from future income rather than from the current sale of your assets.
Under Chapter 13 bankruptcy, the payments you make are fixed so that you can meet all your necessary living expenses first and then pay any surplus income to creditors. A consumer bankruptcy attorney can help you structure a repayment plan that works for you and your creditors.
Homeowners must make all mortgage payments that come due during the Chapter 13 bankruptcy repayment plan. Your mortgage company cannot contact you in regard to your pre-filing mortgage arrears while you are in the Chapter 13 bankruptcy.
However, if you fail to make your post-filing mortgage payments, the mortgage company can ask the bankruptcy court to lift the protection of the bankruptcy code and resume the foreclosure proceeding. The possibility of refinancing your mortgage after you have gotten back on track with your Chapter 13 plan is realistic for many consumers.
Chapter 7 is a liquidation bankruptcy. If you are facing foreclosure on your home, the automatic stay created by your Chapter 7 filing only serves as a temporary defense against foreclosure.
As opposed to Chapter 13 bankruptcy, Chapter 7 bankruptcy will give you a fresh start, but will not provide you with the opportunity to repay your mortgage arrears over time. Chapter 7 bankruptcy is an option you might consider if you know that you will not be able to keep up your mortgage payments, and simply need some breathing room to make alternate plans and the ability to move forward without a deficiency judgment against you.
If you find yourself unable to continue making your mortgage payments due to job loss or other life circumstance, and you want to surrender your home to the mortgage company, Chapter 7 bankruptcy can resolve your mortgage debt.
A local bankruptcy attorney can help you decide if Chapter 7 bankruptcy or Chapter 13 bankruptcy is appropriate for your situation.
Although Chapter 13 bankruptcy is a manageable, effective way for many people to stop foreclosure and get their mortgage payments back on track, filing bankruptcy isn't the only way to stop foreclosure. For homeowners with significant equity, who are not more than 90 days past due, there may be other options.
A bankruptcy lawyer can help you examine your options, and whether bankruptcy, mortgage modification or another option can provide you with the best relief from mortgage foreclosure. Simply fill out the form below or call 877-349-1309 to connect with a local attorney today for a free evaluation.