How Do I Stop Forclosure With Bankruptcy?
When a homeowner falls behind on a mortgage the mortgage lender will usually file a home foreclosure notice with the homeowner. The mortgage lender generally does not file home foreclosure paperwork on a homeowner until the homeowner is behind on the mortgage payments by 3 to 4 months. During a foreclosure the homeowner will need to move from the home. The mortgage lender will then sell the home, and recoup some of the losses from the defaulted mortgage. When the mortgage lender does sells a foreclosed home the home is generally sold at below market value. The only amount the mortgage lender is allowed to sell the home for is the amount owed to them by the homeowners who defaulted on their mortgage.
When a homeowner files Chapter 7 or Chapter 13 bankruptcy a homeowner receives an automatic stay in the home for several months. However, the mortgage lender can file a petition with the bankruptcy court asking for the bankruptcy court to lift the automatic stay, and allow them to continue along with the foreclosure sale. If a homeowner who is in foreclosure files a Chapter 13, and can afford to maintain the mortgage payment plus the repayment the homeowner is allowed to stay indefinitely.
