While all kinds of financial problems due to job loss, divorce, or medical bills can lead to bankruptcy, the event that puts many people over the edge is foreclosure of their home. That’s when debt pressure can become desperate.
Bankruptcy is an effective tool for relieving the pressure of mortgage defaults, and our attorneys at Woodruff Law offices have helped hundreds of people keep their homes. Contact us in Marietta to learn more about our solutions to difficult foreclosure problems.
How does bankruptcy help stop home foreclosure?
In legal terms, mortgage foreclosure is nothing more than a creditor’s remedy to collect a defaulted debt. The automatic stay of bankruptcy stops home foreclosures in the same way it stops any other debt collection activity.
Bankruptcy law protects secured creditors, which includes the mortgage holder. The mortgagee can’t continue with the foreclosure process that has been interrupted by a Chapter 7 or Chapter 13 filing, but the mortgage company may have a strong argument to ask the bankruptcy court for permission (seek relief from the automatic stay) to resume or begin anew the mortgage foreclosure process.
Our experience with mortgage defaults can help you
Your legal ability to keep the protection of the automatic stay in place largely depends on how much equity you have in your home; the more equity you have, the less likely the foreclosure will continue. Questions of fact and law concerning the mortgagee’s right to relief from the automatic stay are heard and decided by the bankruptcy judge.
In our experience, the real question is: are you able to resume your regular monthly mortgage payments? If you can, we can usually negotiate the problem with the mortgage holder. Payments for defaults prior to bankruptcy can be spread out over the repayment period in a Chapter 13 bankruptcy, but the mortgagee will need assurance that future payments will be made as agreed by your deed to secure debt, or as normal.
Working out mortgage problems and preventing future foreclosure proceedings represent a major strength of our bankruptcy practice. We can help you right up to the moment of the foreclosure sale. To learn more about our approach to mortgage foreclosure in bankruptcy, contact one of our lawyers at Woodruff Law offices at our Marietta location.
We are a debt relief agency. We help people file for bankruptcy relief under the Federal Bankruptcy Code.