Many homes are being foreclosed regularly in California, and you can only wonder why those homeowners do not take action. Many homeowners do not know the laws protecting their homes and how to maximize it to stop foreclosure. After a failed loss mitigation application, homeowners give up, believing they have done their best. You’re not as helpless as many will have you think, and if all other options have failed, you can still stop the foreclosure by filing for bankruptcy.
Homeowners usually afford bankruptcy because of the damage it might do to their credit score. However, having your home foreclosed will cause much more damage, and you will still lose your home. Suppose the foreclosure sale date is near, filing for bankruptcy is the only way you can stop foreclosure and save your home. So how does bankruptcy helps keep your home?
Once you filed for bankruptcy, an order called ‘Automatic stay’ comes into effect and stops all creditor’s activities. The order is usually given the hour you file your petition till the court reviews your case. Therefore, your lender will not be able to take steps towards gaining their money back and also have to stop foreclosure immediately. Suppose a foreclosure sale has already occurred; if you filed for bankruptcy 5 minutes before the sale was concluded, the sale would be canceled.
Filing for bankruptcy is not something you should do yourself, have an attorney help you through it. You will save yourself a lot of stress this way, and not just that, your lawyer will be able to provide legal advice for you on which chapter of bankruptcy you should file. Another reason to consider having a lawyer with you is that if you want to keep your home, you will have to negotiate a repayment plan with your lender after the court has reviewed your petition. A lawyer will make the negotiating process more straightforward and with better results.
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