Chapter 13 Can Stop a Foreclosure If You Qualify
Filing Bankruptcy Can Stop Foreclosure
Yes, bankruptcy can stop foreclosure, but this isn’t the whole store. There are also some exceptions to this chapter 13 strategy to stop foreclosure. If a person qualifies for chapter 13 bankruptcy, filing can allow reorganization of your debt in order to catch up mortgage arrears throughout the period of the chapter 13 plan, which typically involves a 5 year repayment. This is how it will stop foreclosure dallas.
However, this all being said, the question and discussion about whether chapter 13 is the right decision for you does not stop there. For those who have filed more than one bankruptcy in the past year, it’s possible that the bankruptcy court will not enact or continue the stay which prevents the foreclosure. It is the automatic stay of bankruptcy that stops foreclosure’s proceedings. The automatic stay also blocks repossessions alongside it’s cousin of foreclosure. However, in certain cases, it could still be possible in a chapter 13 to block the foreclosure under guidance of a good dallas bankruptcy attorney and with the approval of the judge. Chapter 7 bankruptcy may also provide a situation where you can temporarily stop foreclosure, yet this option does not provide a long term solution to protect the home from eventual foreclosure. If a person can get caught up on their own without a 3-5 year repayment plan for the mortgage arrears, then this could be the temporary relief needed in order to block the imminent and immediate threat.
Consider Options Carefully, Then Choose Best Financial Step
When weighing the decision of whether you file or not file bankruptcy, a large emphasis should be placed on whether you are in the right house to begin with. We have clients visit our office routinely who do not have the money to be in a particular home but who really would like to be in that home. They try and try to stay but ultimately do not have the income to handle the payments. Foreclosure prevention through bankruptcy is only going to delay the inevitable if that person does not get more income or a mortgage modification.