Foreclosure is not as automatic as many will have you think. Your lender can’t initiate foreclosure unless some procedures have been fully served. Your lender is mandated to keep you informed about the state of your account. Therefore, every time you miss a payment, your lender will send you a notice of delinquent. Usually, after you miss more than one payment, your lender will contact you to discuss loss mitigation alternatives with you. If you did not respond or the negotiation didn’t go well, your lender will wait till the 120 days mandated by the law to be over and then initiate foreclosure. The 120 days are counted from when you started missing your payments, and then your lender has the right to sell your property.

You can now see you that foreclosure isn’t automatic. You have enough time to stop foreclosure and save your home. After a notice of default, your home won’t the sold the next day. Foreclosure proceedings last for different time lengths, depending on how the foreclosure is processed in your state. You should still have enough time to discuss other options with your lender, and if none seems to be productive, you should file for bankruptcy.

Filing for bankruptcy will help you stop foreclosure immediately. Although you shouldn’t rush to file for bankruptcy, wait till a notice of foreclosure is sent before you proceed to file for bankruptcy. Usually, most lenders won’t accept any for if loss mitigation once a foreclosure proceeding has been initiated. Filing for bankruptcy becomes the only way you can save your home afterward. Depending on which chapter you filed, you will be able to negotiate a loan modification with your lender.

There are many chapters of bankruptcies, research adequately about your options, and determine which is best for you considering your financial situation. Contact your lawyer and discuss with him or her to determine which chapter you should file.

Comments

comments