Helpful Information About Foreclosure Or Bankruptcy
Saturday, April 11th, 2009 Subscribe To Our Feed
Filing for bankruptcy can be a severe step, and if you find yourself in that situation, you may wonder if you should not instead just allow the mortgage lender to go ahead with the foreclosure. Either/or doesn’t always cut it, and deciding between the two is always a hard choice to make. A mortgage lender will file a foreclosure action when it is not paid its monthly mortgage payments. You must pay the lender who is filing the action in order to prevent the action from going forward. Another type of loan, a car loan, will result in the loss of your car through repossession if you are not diligent in paying your loan. If a person does not make their mortgage payments, they face the loss of their home through foreclosure.
Bankruptcy is an action which is declared by a person incapable of paying their debts. This action stops all civil proceedings against the debtor while the debtor is in bankruptcy. By law, then, a lender has to suspend legal actions including a foreclosure. Lenders respond by filing for relief from this order, and once they are invariably granted such relief, the legal action will continue forward and the house lost. The bottom line is that bankruptcy does not stop foreclosure and it does not allow a debtor to keep a house without paying the mortgage lender. The best bankruptcy can do is slow down the process, but it cannot stop it entirely.
Occasionally, however, foreclosure is prevented through bankruptcy, as the latter gives person additional time in which to pay the lender and usually makes the paying easier.
Bankruptcy makes a mortgage lender pause in their foreclosure efforts, and a debtor has a little extra time to raise the money. Also, the bankruptcy frequently frees up additional funds that no longer have to be paid to other debts so that the buyer can more easily pay their mortgage payments. Through a chapter 13 bankruptcy filing, the debtor is able to - through a court order - pay their mortgage catch up over a period of time rather than all at once.
Of course, there is a good chance that a debtor might not actually be able to file for bankruptcy, as eligibility is an issue, and even if they do qualify, there are legal fees that need to be paid. As legal fees are known to be very high, a debtor can find themselves in the position of finding their legal bills more expensive than the mortgage they owe. Discussing bankruptcy over with a licensed lawyer is an important step for anyone trying to avoid or halt a foreclosure. Without legal assistance, bankruptcy is too complicated to endure by yourself. The material offered in this article should serve only as a general guide, and for more specific information, you should contact a licensed lawyer in your state.
Mortgage Loan Modification is arguably the most effective tool you can use if you are behind on your mortgage. Don’t lose your home due to foreclosure when you can take out a Loan Modification Agreement that will help you keep your home and reduce your monthly expenses. A Loan Modification Agreement can prevent foreclosure only if you act now before its too late. Click here www.loan-int.com/loan-modification/ for more information..
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