The Foreclosure Solution
I’ve read a lot of articles and listened to a lot of reports in the media about the very high foreclosure rates across the country. It seems a lot of people are behind on mortgage payments and face foreclosure. While this news saddens me as I think about the families that are struggling with this problem, I know there could be a solution. Bankruptcy could stop a foreclosure or protect a person from any deficiency balance that might result from a foreclosure sale.
While bankruptcy law generally can not change your payment amount on your residence, it can certainly provide a way to help you get caught up on payments. Even with a voluntary mortgage modification or repayment plan through your mortgage company, you would normally have to catch up on payments (including late fees, accumulated interest, escrow deficiencies, and any attorney fees) within a short amount of time (usually 3-6 months). Through a chapter 13 bankruptcy, you could stretch out payments on the arrears over as much as 5 years…60 months! Obviously paying back the arrears over 5 years as opposed to 3 or 6 months would be more affordable.
The other way bankruptcy could help a person facing foreclosure is through a chapter 7. If you simply can’t afford your mortgage payments, chapter 7 could protect you from owing any deficiency balance on any mortgage once the house is sold at a foreclosure sale.
Either way, if you’re facing foreclosure and don’t know what to do, you might consider calling a bankruptcy lawyer and getting some advice about how bankruptcy could save your house!
