“I fell behind on my house payment and now the Bank won’t work with me anymore! They said the house is going up for a foreclosure sale next month! What can I do?” If this sounds familiar, you should contact an experienced Bankruptcy Attorney at RS Law.
Bankruptcy forces the bank to cancel the foreclosure sale. As soon as a case is filed, a Debtor (link to definitions) is enters into a protective bubble or umbrella which is called the “Automatic Stay.” This “bubble” requires all creditors immediately cease all attempts to collect a debt, including a scheduled foreclosure sale. The protective bubble that is the “Automatic Stay” serves a legal purpose but has the beneficial side effect of a “time-out” which gives you time to regroup.
There are usually one hundred and one reasons someone would decide to file bankruptcy and stopping a foreclosure sale is a great reason if saving your home is your goal.
Keep in mind that if you wish to keep your home long-term you will need to bring mortgage current as soon as possible during a Chapter 7, which is discussed in that article titled “Can I keep My House.” However, if you decide to file a Chapter 13 you be in a payment plan that helps you get caught up over three to five years. Unfortunately, Chapter 7 offers no such payment plan.
At this point you may be saying to yourself, “Wait. I thought Bankruptcy forgives all my debts. Why would I need to pay my home loan?” To explain this fully, first secured debts must be explained. The loan on your house is secured or “attached” to your house, bankruptcy or not. This is the reason your lender is allowed to foreclose on your house if you are not paying on the loan. Another way to put it is that your house is what is known as “collateral.” Therefore, if you want to keep your home, you have to continue to pay the mortgage.
If you are facing a foreclosure Contact RS Law today for your free consultation. Get ahead of this foreclosure as soon as possible because time is of the essence!