If the foreclosure sale is scheduled to occur, your surest way to stop foreclosure with bankruptcy is by filing it prior to the sale date. The automatic stay will stop the foreclosure whether you file Chapter 7 or Chapter 13. Once you file for bankruptcy, something called an automatic stay immediately goes into effect. The stay functions as an injunction prohibiting your mortgage lender from foreclosing on your home or otherwise trying to collect its debt. This means that any foreclosure activity must be halted during the bankruptcy process.
An Experienced bankruptcy attorney can determine if Chapter 7 or Chapter 13 will provide the best protection to save your house. If you are in default on your mortgage, contact our office as soon as possible to explore how and when to file bankruptcy to protect your house and provide you with the optimum options.
Don’t depend on the lender’s promise to extend the sale date. Often clients have been misled only to find out one day prior that there will not be a postponement of the sale date. Filing bankruptcy is the surest way to stop any foreclosing and begin the process to protect your house.
Chapter 13 can give you the opportunity to catch up and get current on your house. In certain instances, you can even get rid of a 2nd loan on the house. Chapter 7 can stop foreclosure and buy you time to do a loan modification or just stay longer in your house. There are many options for debtors through the bankruptcy process to stop foreclosure with a bankruptcy filing.