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Bankruptcy Advice on Foreclosure

Bankruptcy or foreclosure may be your only option when you are in deep financial trouble. If you have ran through all your choices of trying to avoid foreclosure with your lender, filing for bankruptcy may be the right solution for you. When you start missing your house payments, you are in a period know as pre-foreclosure, this is the time you need to debate all your options and make some smart decisions promptly.

Usually if you are in Pre-Foreclosure you’ve got about four months until the bank completely forecloses on you. Utilize this time wisely and embark on searching into secondary selections. If you have tried negotiating with your lender, a short sale or deed in lieu of foreclosure and none of these alternatives have processed, it is time to look into bankruptcy.

Filing for Chapter 7 bankruptcy can maybe avoid or hold up foreclosure on your property. For instance when you file for chapter 7 or chapter 13 bankruptcies, the court will issue you an “Automatic Stay.” This is a statement that will keep creditors from collecting money from you right away. If your home is scheduled for foreclosure sale, it must be remitted, while you await the bankruptcy transactions.

When you file for Chapter 13 bankruptcy, this can help you eliminate the payment on your second or third mortgage. If your first mortgage is secured by the entire value of your home, you may no longer have any equity to secure the later mortgages. This will allow chapter 13 bankruptcy to discharge the second and third mortgages and recognize them as unsecured debt. Which under Chapter 13 usually does not have to be paid back. You will want to employ a local bankruptcy lawyer to make sure this gets done right.

Filing for chapter 7 bankruptcy won’t make your foreclosure disappear, but it can provide you time. Filing for Chapter 7 bankruptcy can give you a couple of months, before your house can be sold on you. This time can be vital, for securing a new living situation and saving up money. Chapter 7 can cancel your debt that is secured by your home; including the mortgage, as well second mortgage and home equity loans.

Lastly, if you’re running into some financial problems, don’t neglect your problems and wait for the last minute to do anything. If your facing foreclosure, bankruptcy is something that can help buy you some extra time. Take this advice on bankruptcy on foreclosure seriously for it can one day help you get out of the situation!

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