Many people expect to be able to pay a mortgage for 25 to 30 years, which is why they take one out on their homes. However, if you suffer a financial crisis and are unable to pay your mortgage, your bank may foreclose on your home. If you are facing foreclosure, don’t panic. Call the Law Offices of David Kohm for help with your foreclosure.
Foreclosure and Bankruptcy
Many people file for bankruptcy in order to help resolve a foreclosure problem. You can’t file for bankruptcy for the sole purpose of stopping a foreclosure–you have to qualify for bankruptcy for other reasons. However, filing for bankruptcy can help you keep your home.
- When you file for bankruptcy, you get an automatic stay against your creditors until the bankruptcy is finished. That means that your creditors can’t take any collection action against you. Thus, your mortgage company cannot foreclose on the house while you are in bankruptcy.
- You may be able to include your arrears in a structured repayment plan if you file for Chapter 13 bankruptcy. This allows you to get caught up.
- You may be able to discharge some other debts so that you have money available to pay your mortgage.
For all of these reasons, it may be worthwhile to file for bankruptcy. You need to talk to a foreclosure defense attorney to find out whether this is the best option for you.
Considerations
There are two types of personal bankruptcy. Chapter 7 allows you to liquidate many of your assets to pay your debts, while Chapter 13 requires you to set up a structured repayment plan so that you can repay your debts within three to five years. Your attorney can help you determine which type of bankruptcy is right for you.
Bankruptcy does negatively affect your credit report, so it’s not the right option for everybody. You may also want to consider surrendering your property by returning the keys to the lender or selling your home to repay the mortgage.
If you’re considering bankruptcy to help resolve your foreclosure problems, you need a qualified bankruptcy attorney in Frisco. Call the Law Offices of David Kohm at 817-204-0900 to schedule a consultation.
