Options for avoiding foreclosure

Although the overall economic climate in the United States has improved from what it was during the financial crisis, the need to stop foreclosure remains a pressing issue for many homeowners. Some parts of the country have communities in which 20 percent or more of the homes have market values that are below the secured debt their owners owe to the holders of the mortgages. However, there may be some relief for Florida residents facing foreclosure.

Unexpected loss of a job or a serious illness can leave a person with little or no income and mounting medical and credit card debt in addition to back mortgage payments. The federal government has lists of approved agencies in each state to provide counseling to homeowners at risk of losing their homes in a foreclosure. The agencies familiarize homeowners with the foreclosure process and options, such as refinancing the loan, which might be available. However, once the foreclosure process has been started by the mortgage lender, a delay by a homeowner in contacting a lawyer could make it more difficult to stop foreclosure.

Filing for bankruptcy can put a halt to creditor harassment, and it might also stop foreclosure while the bankruptcy is pending. In a Chapter 13 bankruptcy, debtors repay some or all of their obligations over a three- to five-year period pursuant to a court-approved plan. Back mortgage payments are often included, allowing a homeowner to catch up and then remain current.

Not everyone can qualify for Chapter 13, however. It is designed for people who have regular sources of income, and there are other eligibility requirements that a lawyer will cover during a discussion of debt relief options.