Filing Bankruptcy To Keep From Foreclosure

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Filing Bankruptcy To Keep From Foreclosure

Some people, when faced with the choice between foreclosure and bankruptcy, are not sure which is the right one to choose. Few people realize how difficult the choice is to make, or recognize that the decision is not an either/or one.

Paying the lender is the only true way this action can be prevented. A mortgage loan is sort of like a car loan and if a person does not pay his car payment, he will lose the car through repossession. In a similar vein, if a person is lax in their monthly mortgage payments, they will experience losing their home via foreclosure.

For people who cannot pay their debts, sometimes they file the legal action of bankruptcy. This will put an end to the civil actions being filed against the debtor during the time they are in bankruptcy. This means that the mortgage lender cannot continue through with their legal actions, including a foreclosure.

However, a mortgage lender can file for relief from the automatic stay, and when the relief is granted, simply proceed with the aforementioned action. The bottom line is that bankruptcy does not stop foreclosure and it does not allow a debtor to keep a house without paying the mortgage lender. While it cannot stop the action, bankruptcy can slow it down.

While bankruptcy does not stop foreclosure, it can give a person time to pay a mortgage lender or make it easier for a person to pay a mortgage lender. Bankruptcy makes a mortgage lender pause in their foreclosure efforts, and a debtor has a little extra time to raise the money. Since the act of filing bankruptcy can get rid of many unsecured debts completely, a person who is in debt may find themselves with more money that they can pay their mortgage payments with. In terms of a chapter 13 bankruptcy, the courts will dictate that the payment of the overdue mortgage needs to be paid through several payments, which will further give the debtor time to pay the lender off.

In order to file for bankruptcy, you must first qualify - which not everyone does - and even if you do, you will be faced with large legal fees. Legal bills can be quite high, and high enough that they outweigh the costs of catching up with the mortgage. If you think that bankruptcy may help you stop or avoid foreclosure, talk with a licensed lawyer. No one should attempt a complicated legal process like bankruptcy without legal aide. This article is only intended to give general information, so for more detailed information, contact a lawyer in your state.

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Some people, when faced with the choice between foreclosure and bankruptcy, are not sure which is the right one to choose. Few people realize how difficult the choice is to make, or recognize that the decision is not an either/or one. 
Paying the lender is the only true way this action can be prevented. A mortgage loan is sort of like a car loan and if a person does not pay his car payment, he will lose the car through repossession. In a similar vein, if a person is lax in their monthly mortgage payments, they will experience losing their home via foreclosure. 
For people who cannot pay their debts, sometimes they file the legal action of bankruptcy. This will put an end to the civil actions being filed against the debtor during the time they are in bankruptcy. This means that the mortgage lender cannot continue through with their legal actions, including a foreclosure. 
However, a mortgage lender can file for relief from the automatic stay, and when the relief is granted, simply proceed with the aforementioned action. The bottom line is that bankruptcy does not stop foreclosure and it does not allow a debtor to keep a house without paying the mortgage lender. While it cannot stop the action, bankruptcy can slow it down. 
While bankruptcy does not stop foreclosure, it can give a person time to pay a mortgage lender or make it easier for a person to pay a mortgage lender. Bankruptcy makes a mortgage lender pause in their foreclosure efforts, and a debtor has a little extra time to raise the money. Since the act of filing bankruptcy can get rid of many unsecured debts completely, a person who is in debt may find themselves with more money that they can pay their mortgage payments with. In terms of a chapter 13 bankruptcy, the courts will dictate that the payment of the overdue mortgage needs to be paid through several payments, which will further give the debtor time to pay the lender off. 
In order to file for bankruptcy, you must first qualify - which not everyone does - and even if you do, you will be faced with large legal fees. Legal bills can be quite high, and high enough that they outweigh the costs of catching up with the mortgage. If you think that bankruptcy may help you stop or avoid foreclosure, talk with a licensed lawyer. No one should attempt a complicated legal process like bankruptcy without legal aide. This article is only intended to give general information, so for more detailed information, contact a lawyer in your state. Article Source: <a href="http://www.allbestarticles.com" target="_blank">Credit Card Bad Credit People</a> About the Author: You can check out: <a href="http://www.access-more-information.com/buying-and-selling-real-estate-business.html">selling real estate in a slow market</a> and <a href="http://www.access-more-information.com/buying-and-selling-real-estate-business.html">psychology of selling a home house real estate</a> for more information.