How bankruptcy can help you keep your home
If you are facing the possibility of losing your home to foreclosure, it is important that you understand that you have the right to fight back and that you have options to save your home. While there can be a number of different approaches to dealing with mortgage debt, filing for bankruptcy has a number of distinct advantages.
The first advantage: Getting bill collectors off your back
When you file for bankruptcy, federal law demands that all collection activity stop immediately. This includes types of collection activity, such as phone calls, demand letters, wage garnishments, repossession actions — and foreclosures. In a consumer bankruptcy filing, the suspension of collection activities gives you time to develop a plan for dealing with your debts without the hassle of collectors constantly seeking payment.
So, exactly what does filing for bankruptcy have to do with saving my home?
In addition to stopping a foreclosure lawsuit, bankruptcy can provide a way for you to get caught up on your past due mortgage payments without having to come up with a lump-sum payment all at once. In a Chapter 13 filing, you can repay your mortgage arrearages as part of your court-approved debt repayment plan. It is important to note, however, that you will be expected to stay current on your new mortgage payments in addition to making your scheduled debt payments to the bankruptcy trustee.
An experienced lawyer can help.
Federal bankruptcy laws can be difficult to understand for people who are not familiar with them. A qualified bankruptcy lawyer can help you understand your options and whether bankruptcy is a good option for you. Be sure that you have all the information available so you can make the best possible decision for your situation.
Come back next time when we will discuss other possible options for saving your home from foreclosure.