Foreclosure and Bankruptcy

For most people, a mortgage is linked to their most expensive asset; and debt. If the debts owed on your home become too high of a financial burden to bear, you have a short window to seek help for your missed payments before losing the home.

Foreclosures 101

Foreclosure is a legal process by which mortgage lenders can take a property from a homeowner that has defaulted on their loan. Typically, the foreclosure process can last from one to seven months, depending on the state you live in. However, there are situations in which a mortgage lender may begin the foreclosure process after the first missed payment. Through the foreclosure process, the lender can evict your family when it sells the home to satisfy the mortgage you owe.

Although the foreclosure process can be swift and severe, there are options for resolving outstanding mortgage debts. But time is ticking on the clock of debt resolution.

Foreclosure Solutions

There may be a couple of options that can be taken to get you out of this trouble. It may be that you need to file for bankruptcy if none of the other options like loan modification is available to you. It may be that you have let your situation go too long and the foreclosure sale is eminent. It is not too late to file for bankruptcy and stop the sale as long as the sale hasn’t already taken place.

An automatic stay will be put into effect immediately. This is like an injunction that won’t allow the mortgage holder to proceed or to continue trying to collect. The lender could also petition the courts to lift the stay so they can continue with their actions. This may be successful but it will stall the foreclosure proceedings. It will at least buy you some time to seek out other possible alternatives. There may be a possibility your loan holder will give you a loan modification, which are few and far in between, but it is worth asking. If you do seek out a loan modification you will probably have to call every day and get them to answer your questions. People have had success in asking for a modification to lower the interest rate and reduce the payments. They have also received the modification even after declaring bankruptcy.

Both the foreclosure and bankruptcy process are not for the faint of heart. They both require the help of an experienced attorney. Contact an experienced Sacramento bankruptcy attorney today to discuss your options for keeping your home while resolving your debts.