If you are behind in your mortgage payments and worry you may lose your house to your lenders, you may want to consider filing bankruptcy. Bankruptcy can stop the foreclosure process by implementing the automatic stay, which stops most collection attempts against you.
Filing bankruptcy will not stop the foreclosure process forever, and it will not relieve you of the obligation to make your home payments. It will, however, give you some time to attempt to figure out what you want to do with the home and how to get your finances in better shape.
If you do not want to keep your home, you can surrender the property to the lender and cancel any remaining mortgage. You will also be able to eliminate all other qualifying debt in bankruptcy, such as credit cards, medical bills, payday loans, and late utility bills.
If you do want to keep your home, you will have three to five years to catch up on the payments. Sometimes you can even restructure your loan as part of the bankruptcy process, making it easier to make the payments in the future. You will also need to keep current on your house payments if you wish to keep the collateral.
If you are worried about your credit rating if you file bankruptcy, remember a foreclosure will not be any more favorable to potential lenders. The difference will be that you will get to keep your home if you wish when you file bankruptcy.
If you are behind in your mortgage payments and need some time to figure out how to proceed, contact a Sacramento bankruptcy attorney to discuss your options.