If you have been behind on your mortgage payments and you don’t want to lose your house to foreclosure, consider filing for bankruptcy. However, keep in mind that this option is not a quick fix. When you file for bankruptcy, you may need to agree to a debt repayment plan. But if you have exhausted all your options to prevent foreclosure, bankruptcy might be the perfect strategy to save your home. If you choose this route, contact a bankruptcy attorney in Charleston, WV, and discuss your situation. Keep reading to know how bankruptcy may help save your home:
Through an Automatic Stay
Filing for bankruptcy will mean an automatic stay takes effect. The court order will provide protection from foreclosure because all creditors are directed to stop their collection efforts. Home foreclosure will be put on hold while your bankruptcy is pending. However, remember that mortgage lenders can file a motion to lift this order.
Through Chapter 7 Bankruptcy
When you file for Chapter 7 bankruptcy, you will have time to negotiate with your lender, letting you prevent foreclosure. However, if negotiations fail, you may lose your house after your bankruptcy case. With Chapter 7, your eligible assets will be sold to pay off your debts. The sale may include your home, which means you can only temporarily prevent foreclosure. However, since the bankruptcy process can take months, you have time to explore other living arrangements. Chapter 7 can eliminate your mortgage debt together with other debt that your property secured.
Through Chapter 13 Bankruptcy
When you file for Chapter 13 bankruptcy, you must commit to a repayment plan, preventing foreclosure. This bankruptcy option allows you to catch up on the mortgage payments you missed and pay other debts for three to five years. But you must adhere to the mortgage schedule established during bankruptcy negotiations.
Additionally, Chapter 13 lets you deal with several mortgage loans. If you cannot secure another mortgage, a skilled attorney can use line stripping, so you can keep your house.
Whether or not bankruptcy is the right option to prevent your home from being foreclosed depends on your circumstances. A competent bankruptcy lawyer can offer you the necessary information you can use to protect your interests. Both bankruptcy and home foreclosure have long-term effects on your financial future. By getting advice from a lawyer, you can determine how to best resolve your mortgage situation. Your attorney will help you understand all your options to stop a bank foreclosure on your Charleston house.