Suppose your mortgage lender is on the verge of foreclosure. You can delay or stop the foreclosure process by filing a bankruptcy motion (also known as a foundation or skeletal petition). You may have more time to discuss this with the bank.
Note that Chapter 7 is conditional only if foreclosure is avoided. Chapter 13 is probably the best choice if you want to keep your house in order. Learn all about bankruptcy litigation that forbids the sale of foreclosures and critical insolvency proceedings.
You can take advantage of auto-stay by filing bankruptcy if you don’t have the time to fill in all the bankruptcy details. You may qualify for an emergency bankruptcy by filling out a few forms and taking a credit advice course. You will then have 14 days to complete and forward the remaining necessary documentation to the court.
How easily a lender may foreclose his house depends on the law of the State. If you have received a bank forfeiture letter, we advise you to read it carefully to decide your sale date. In some jurisdictions, the lender will have to warn you before default and wait until the date of the foreclosure has been set.
When you file a bankruptcy petition (including an emergency claim), the lender will not continue with the mortgage’s sale immediately after an automatic stay. Bankruptcy can delay or stop the foreclosure process until the house is sold. But if the lender sells your home, you don’t have it anymore, and you can’t be saved by bankruptcy.
In most cases, the following forms can be filed for bankruptcies:
- Form 101—Voluntary bankruptcy petition
- Form 121 – Disclosure of Social Security Numbers
- Names and addresses of all creditors (mailing list creditors or mailing matrix; review the formatting requirements for your court).
- The requirement of a credit counseling certificate or apply for waiver and
- Registration fee, request for waiver of the fee, or request for payment of the fee in installments.
Some courts may need more forms. You should check the requirements with your local bankruptcy court in your area. After filing an emergency petition, you have 14 days to file the remaining required bankruptcy forms and plans. If you cannot do so, your case will usually be dismissed (you can resubmit it immediately).
Speak with a bankruptcy lawyer.
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