Facing a foreclosure sale is a terrifying possibility for homeowners. You worked so hard to provide a good home for your family and now you are in danger of losing that home due to a financial crisis. Most homeowners facing a foreclosure sale are in this situation due to a job loss, medical emergency, loss of a spouse (by death or divorce) or other financial crisis that caused the homeowner to be unable to pay his or her mortgage payments. By the time that most homeowners contact my office to discuss saving their home through bankruptcy, they have tried everything within their power to catch up mortgage payments to stop the foreclosure sale.
Foreclosure Sales in Chapter 13
If you are facing a foreclosure sale, you may be eligible to file a Chapter 13 bankruptcy case to stop the foreclosure sale. A foreclosure action, including the foreclosure sale, will stop immediately upon the filing of a Chapter 13 bankruptcy case provided the bankruptcy is filed before the foreclosure sale. As soon as you file your bankruptcy case, the automatic stay prevents creditors from continuing with any actions to collect debts including but not limited to continuing with a foreclosure action or selling a home at a foreclosure sale.
If you file a Chapter 13 case, you will include the past due mortgage payments in your bankruptcy plan and resume making your normal mortgage payments outside of the plan. This allows you to keep your home while catching up the past due payments over a 36 to 60 month bankruptcy plan.
Foreclosure Sales in Chapter 7
While filing a Chapter 7 bankruptcy case will stop a foreclosure sale in the same way that filing a Chapter 13 bankruptcy case, it does not allow the debtor to catch up the past due payments over a bankruptcy plan. Filing a Chapter 7 bankruptcy case only temporarily postpones the foreclosure sale until the debtor completes his bankruptcy case (typically four to six months from the date of filing) or the mortgage lender petitions the court to modify the automatic stay.
Even though a Chapter 7 case may not allow the debtor to avoid foreclosure sales unless the debt can work out some way to catch up the past due mortgage payments before the mortgage lender is able to reset the foreclosure sale, it does allow the debt some additional time to make other arrangements.
Contact an Experienced Mount Holly Bankruptcy Attorney
Personal Approach, Professional Service, Affordable Payment Plans
The Law Office of Travis J. Richards, LLC is a full-service Mount Holly bankruptcy law firm focused on Chapter 7 Bankruptcy, Chapter 13 Bankruptcy, debt consolidation, credit repair, tax liens, student loans and foreclosure. We represent clients in Burlington County and throughout South Jersey.
If you are experiencing financial problems due to debt, contact our office at 609-267-5297 to schedule your free consultation to discuss bankruptcy and non-bankruptcy alternatives. You may also use our convenient online contact form and one of our friendly, professional staff members will contact you to answer your bankruptcy questions and/or schedule a free consultation with Travis J. Richards.
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