Which Bankruptcy Chapter is Best if I Fear Losing My Home?
If you are experiencing substantial financial problems, there is undoubtedly a great deal of stress overall. There may be medical bills piling up, along with credit card debt. You may be dealing with debt collectors and numerous lenders—all who want their money—and they can be quite loud about letting you know that, whether by phone or through the mail.
Bankruptcy May Allow You to Keep Your Home
For most of us though, nothing is more terrifying than the thought of losing your home. As financial distress increases, you may be turning to bankruptcy as your final option. Along with dealing with overwhelming debt issues, you may find that one of the greatest benefits in filing for bankruptcy is that it allows you to save your house.
Both Chapter 7 bankruptcy and Chapter 13 are powerful tools to be wielded in re-organizing your finances and clearing your debts. If you are eligible for Chapter 7, you can look forward to having many of your debts discharged in three to six months. As for your home, you will need to take serious stock and decide whether you want to keep the home or hand it back to the lender.
Extra Funds Available During Chapter 7 May Help
With the automatic stay, you will be able to fend off foreclosure temporarily. The home is usually considered protected as exempt property, but there are issues to consider. If you have a lot of equity in the home, the bankruptcy trustee could consider selling it to pay off creditors. If you are behind on payments but want to file a Chapter 7 instead of a Chapter 13 and keep your home, you may have the chance to make up arrears as you are no longer paying on other debts. While the automatic stay will stop foreclosure in the beginning of bankruptcy, the mortgage lender can file to have the injunction lifted. Their request may be granted quite easily if you are far behind on payments.
Delinquent Payments Owed Can Be Rolled Into Chapter 13
In Chapter 13, your chances of saving the home are much better. Here, you have latitude with delinquent payments as they can be folded into your repayment plan. Even in Chapter 13 though, saving your home can be tricky as you must make your payments—whether paying directly to the lender or into your bankruptcy repayment plan—and all the delinquencies must be paid off by the end of the bankruptcy or you could still be in danger of foreclosure.
With a plan in place and three to five years to stay current and re-pay delinquent payments, hopefully you will not only find yourself with new financial freedom at the end of the bankruptcy, but you will have saved your home too.
Contact us Now
If you are interested in exploring ways to organize and eliminate your debt, contact the attorneys at Fitzgerald & Campbell, APLC. We can review your current situation and discuss your options with you, whether that means bankruptcy or other options. Our attorneys have decades of experience representing clients in all types of consumer rights matters and we are here to help you!
Call us today for a free consultation at (855) 709-5788, or email us at firstname.lastname@example.org.