Foreclosure Options

If you are facing foreclosure there are several options available that most consumers are not aware of.  One of those options is applying for modification of your loan under one of the recent government programs.  Your bank is more than likely part of a Department of Justice settlement that requires them to look at any and all options available before they can foreclose on a home   You might also be able to temporarily stop the process by filing for either Chapter 7 or Chapter 13 bankruptcy, and permanently stop the foreclosure by filing and completing a Chapter 13.

  • When you are at least 3 months behind on your mortgage your lender may begin foreclosure proceedings. The foreclosure will be completed unless a bankruptcy is filed or you are able to pay all of your past due payments.

  • While you can file for bankruptcy at any time up until the sale of home, it is best not to wait until the last minute since unexpected problems might delay a filing. Your choice of either Chapter 7 or Chapter 13 bankruptcy is crucial in the context of a foreclosure.

  • If you elect a Chapter 7 bankruptcy and are in arrears, the lender will ask the court’s permission to proceed with its foreclosure and this request will likely be granted. This is not to say that a Chapter 7 is never the right choice when you are threatened with foreclosure.

  • If you elect a Chapter 13, you will usually be permitted to repay your arrears over a period of three years, as long as you comply with the rest of your Chapter 13 repayment plan and continue to pay your current mortgage payment.

  • If you decide that selling your home is the best option, you may be able to delay a foreclosure while a sale of your property is completed.

For additional legal advice on foreclosures, contact us today!