Can Bankruptcy Help You Avoid Foreclosure?

Posted on: February 17, 2015

Can Bankruptcy Help You Avoid Foreclosure

If you are overwhelmed with bills and are struggling to make payments on your house, you're not alone. Many Americans are dealing with debt in much the same way. Mortgage lenders are quick to start the process of foreclosure when an individual fails to make payments on time. If you've been threatened with the possibility of foreclosure, you are probably afraid of losing your home. Although you may feel powerless to stop the foreclosure process, you may be able to keep your home if you file for bankruptcy. Here's what you need to know about the bankruptcy process.

If You File For Bankruptcy, You Get an Automatic Stay

When an individual files for a Chapter 7 or a Chapter 13 bankruptcy in the state of California, they will get an automatic stay. What this means is that the court will order your creditors to cease all collection activity while the bankruptcy is pending. Not only will an automatic stay stop bill collectors from calling you or sending you letters while your bankruptcy is processed, it also will stop your mortgage lender from foreclosing on your home. In cases where the foreclosure notice has already been filed or your mortgage lender files a motion to lift the stay, the foreclosure may still move forward. However, in the vast majority of foreclosure cases, filing for bankruptcy will halt the foreclosure in its tracks and may help you keep your home.

You Can Get Caught Up On Your Mortgage Payments In the Meantime

If your home is being foreclosed on, it is critical that you prioritize your monthly mortgage payments. You are still responsible for your mortgage payments, even after filing for bankruptcy. Use the time given to you by the automatic stay to get caught up on your mortgage payments. Your lender is much less likely to file a motion to lift the stay if you are making timely payments in an effort to get caught up on your mortgage.

Contact an Experienced Riverside County Bankruptcy Lawyer Today

Having a foreclosure on your credit record can make purchasing a new home extremely difficult. Avoiding foreclosure at all costs is imperative to preserve your credit score and to keep the home you've invested so much in already. By working with a skilled Riverside County bankruptcy lawyer, you may be able to completely avoid or stop the foreclosure of your home through filing for bankruptcy. Filing for bankruptcy also will help you obtain a clean financial slate that allows you to start over.

At Farhat Law Firm, APC, we understand how challenging foreclosure can be, and we are committed to providing each of our clients with exceptional and comprehensive legal services. We will work closely with you to determine the best strategy to avoid foreclosure, so you can keep your home and get back on the right financial footing. Contact us today at (951) 808-0529 for a consultation.