You can stop foreclosure by filing either chapter 7 or chapter 13 bankruptcy, but you can only save your home from foreclosure through chapter 13 bankruptcy. When you file either chapter 7 or chapter 13 bankruptcy the automatic stay will stop the foreclosure process. However, in chapter 7 bankruptcy the lender will eventually be able to resume foreclosure since you will continue to be in default on the loan. In contrast, you can repay late mortgage payments over 3 to 5 years through a chapter 13 repayment plan. Once you have repaid these late payments you will no longer be in default thereby removing the lender’s ability to initiate foreclosure proceedings. Therefore, you can only save your home through chapter 13 bankruptcy, but you can still delay foreclosure in chapter 7 bankruptcy.
Get Advice From A Bankruptcy Lawyer
The first step to saving your home from foreclosure is speaking with a chapter 13 bankruptcy attorney. In speaking with a chapter 13 bankruptcy attorney you will learn whether you qualify for chapter 13 bankruptcy and if your repayment plan will last 3 or 5 years. Also, you will learn whether you can afford to make your chapter 13 plan payments out of future income and thereby save your home. Furthermore, if you have a second mortgage that is underwater you can find out if you can eliminate that second mortgage in bankruptcy. In essence, the first step to saving your home through chapter 13 bankruptcy is getting sound advice from a local bankruptcy lawyer.
It cannot be stressed enough that you need to get advice from a lawyer and not friends or family members. Your sister may be a great nurse, and your brother may be an amazing mechanic, but neither are attorneys. Legal advice should be obtained from an attorney during a free, confidential consultation. Many clients ruin their chapter 13 bankruptcy by taking bad advice from a friend or family member. Therefore, the final lesson in this article is to not forget the first step: speak with a bankruptcy lawyer and place their legal advice above that of friends and family members.