How I can I Use a Bankruptcy Filing to Stop a Sacramento Home Mortgage Foreclosure?
For many people living in and around Sacramento, California, the foreclosure of a home may become an unfortunate reality. Perhaps you lost a job, suffered a severe injury or illness, or otherwise experienced a major expense that caused you to fall significantly behind on your mortgage. In today’s world, these events are all too common and represent a major hardship for any person who has poured his or her time and effort into a home. However, facing foreclosure doesn’t guarantee the loss of your house. Bankruptcy can always delay foreclosure, and in many cases, it can stop the process altogether and give you more time to repay the back debts.
At The Bankruptcy Group, our experienced attorneys pride themselves on helping homeowners with legal solutions that many believe to be impossible or nonexistent. Our strategic team of attorneys can often help Sacramento-area homeowners protect their house by stopping the foreclosure proceedings they face. To schedule a free and confidential consultation at our Roseville or Folsom law offices, call 1-800-920-5351 or contact us online today.
Why Am I Already Facing Foreclosure if I Didn’t Go to Court?
Many people who have received a Notice of Default on their mortgage are frequently confused by the course of events. They often wonder why they received a foreclosure notice despite never going to court or having an opportunity to fight the foreclosure. This is because the California foreclosure process is non-judicial in nature, meaning the lender or mortgage holder is not required to go to court to get approval to start the proceedings. In fact, many mortgage contracts in California also include language to this effect.
Fortunately, a mortgage foreclosure does not occur overnight. Individuals must typically fall several months behind on their mortgage payments before a mortgage holder will take action against them. Furthermore, upon notice of the Notice of Default, state law provides that the homeowner will have three months before the date of a foreclosure sale can be published. Thereafter, an additional 21 days must pass before the actual sale is held. These statutory notice periods often provide the homeowner an opportunity to take legal action, including bankruptcy, to stop foreclosure and keep their home.
Can Bankruptcy Stop My Home Foreclosure?
All forms of bankruptcy can provide, at minimum, temporary relief from home foreclosure. This is because all forms of bankruptcy offer what is known as the “automatic stay.” The automatic stay prevents creditors from engaging in new collection attempts against the debtor. The bankruptcy is frequently filed following the commencement of foreclosure proceedings. Since the automatic stay is subject to a court’s discretion, the automatic stay can often be overturned through a motion filed by the mortgage company.
In most cases, Chapter 13 offers the most needed and favorable protections for a homeowner who is facing foreclosure. With this Chapter a bankruptcy filer can secure a payment plan that (s)he can then use to provide more time to catch-up on missed payments. The duration of a plan can range from three to five years. During this period the homeowner must ensure that (s)he can not only make regularly scheduled mortgage payments, but also pay back the missed payments that are in arrears. If the Chapter 13 bankruptcy filer can successfully complete his or her court-approved payment plan, the home will be saved. In any case, the individual will be able to maintain possession of the home for, at minimum, the duration of time (s)he is able to satisfy the plan.
Chapter 13 Can Address Second and Third Mortgages
One other benefit provided by a timely Chapter 13 is lien striping. The “strip-down” ability of Chapter 13 bankruptcy is not available in Chapter 7. Strip-down allows a Chapter 13 filer to re-categorize additional mortgages not secured by the value of the property as unsecured debt. Unsecured debt is assigned the lowest priority in Chapter 13 proceedings. Re-classifying this debt can provide a significant financial benefit to the homeowner.
A Sacramento Bankruptcy Lawyer Can Provide Legal Solutions to Stop Foreclosures in California
If you are facing the loss of your home, condo, or other property through foreclosure, the worst thing you can do is take no action. The longer you wait, the less time that will be available to consider potential solutions to protect your home. In some cases, waiting too long can even narrow or eliminate some legal options.
If you are concerned about the loss of your home due to falling behind on your mortgage, the experienced lawyers of The Bankruptcy Group can often provide help. To schedule a free and confidential consultation, call 1-800-920-5351 or contact us online today.