Foreclosure occurs when someone fails to someone fails to pay back debts. This failure leads to property being taken over and liquidated to pay the creditors. This is a legal process, yet this is not a difficult one to understand. A lawyer might be able to give you a detailed account about this.
When a debtor misses payment for about six months, the creditor seeks legal assistance and eventually the house gets auctioned in order to clear debts. This process includes several stages, like – notifying the home owner. However, since this is not an overnight process, you always get some time to plan an alternative.
What can you do when you have debt mounting and not enough money to pay the creditors? You can seek legal assistance to find a solution. A West Palm Beach foreclosure attorney experienced in handling bankruptcy cases will be able to provide you proper solution. Bankruptcy is a possible means to avoid the foreclosure. However, sometimes filing bankruptcy is not enough. In such case all you can do is file the bankruptcy to gain time.
Delaying the Foreclosure
Now, if you want to gain time for a better plan or financial abundance, filing either chapter 7 or 13 is your best option. The moment you file this, the bank imposes an automatic stay order, making you immune for a time being. The creditors cannot auction your house when the stay order is active. In case the house is programmed for foreclosure, the process will be delayed immediately. However, there are some exceptions to this law.
Sometimes the creditors apply to the court asking for permission to proceed with the auction. If this is granted, you will not obtain the time you have sought. However, even in that case, you will get at least a couple of months to make other arrangements.
In some states, you cannot file for bankruptcy after receiving the foreclosure notice. This refers to the incident you have already received the auction notice and then you have filed for either chapter 7 or 13, your petition will be dismissed.
Chapter 13 Bankruptcy
This is the right option for you. A lawyer will be able to give you better suggestion in this regard. However, Chapter 13 will enable you to keep your property. When you file for this, the automatic stay order keeps the creditors from auctioning your home. This method provides you the chance to plan your payment schedule. This is known as repayment plan. In this plan, you need to include detailed description of your payment scheme. The court wants to know how you want to make the payment and you need to provide an answer.
Chapter 13 may eliminate some of the mortgages. However, this depends on the amount of debt and your income. Without s steady income, you may be able to keep your asset.
Chapter 7 Bankruptcy
This is may not be the right option in this situation. Chapter 7 is known as liquidation. Some of the debts get eliminated. However, chapter 7 is unable to erase the lien. This is the reason, if you want to cancel the foreclosure, chapter 7 may not help you. Even if this method works for you, there is a chance that you fail to qualify.
Summary – To prevent foreclosure, you need to seek legal expertise. There are options that can either cancel the auction or provide you time to make a better plan. Bankruptcy is the right option in such a situation. However, a lawyer will be able to provide better suggestion.
Mark Hall is a freelance writer. His area of expertise is bankruptcy law. He writes on numerous online blogs. In his latest article he spoke about how bankruptcy can prevent foreclosure. He suggests you to contact West Palm Beach foreclosure attorney.