How Bankruptcy Can Save Your Home From Foreclosure
Jobs are not as secure as they used to be. Companies are shutting down and laying off employees. Businesses are trying to automate certain tasks through technology, reducing the need for humans. The cost of living is constantly increasing, and even those with jobs are finding it harder and harder to make ends meet.
As a result, many people are losing their homes. Mortgage payments take a huge chunk of one’s paycheck, and sometimes food and utilities come first. It’s not hard for a person to suddenly become one, two, three or more months behind on their mortgage. They go into default and the foreclosure process starts.
Nobody wants to lose their home, especially if they have lived in it for many years or are raising a family in it. Having to uproot suddenly can be stressful. That’s why if you are facing foreclosure, you need to know how to protect yourself.
Bankruptcy is one option to stop foreclosure. A Chapter 13 bankruptcy allows you to keep your home, as long as you make payments toward it. In addition, the bank will be forced to stop collecting on the debt through an automatic stay. They can no longer harass you through letters or phone calls. They will not be able to collect on the debt until the court allows them to do so.
Through a Chapter 13 bankruptcy, you will be able to make up missed payments through a repayment plan, which typically lasts 3-5 years. This plan helps you reorganize your finances so you can pay off credit cards, personal loans, auto loans and other debts. If you have a line of credit or home equity loan, a bankruptcy can eliminate it. If you abide by the terms of your repayment plan, your mortgage will become current and you will still have your home at the end.
Bankruptcy, however, is not the only way to save your home from foreclosure. It only works if you have constant income coming in, so if you currently have no job, you will likely end up losing your home. Contact your lender to discover other options, such as loan modifications and repayment plans with more affordable terms.
Bankruptcy also has some downsides. It can impact your credit score significantly, dropping it by as much as 240 points. It can also stay on your credit report for as long as 10 years, making it difficult if you plan to make any huge purchases in the next decade. However, a foreclosure will also impact your credit score, so it may be wise to consult with an attorney to ensure you are making the right decision.
Contact a Coral Springs Bankruptcy Attorney
Many people are having trouble hanging onto their homes. If you are behind on mortgage payments, you are not alone. You don’t have to lose your home. There are options, but you have to be proactive.
Bankruptcy can help protect your home from foreclosure. Contact a Coral Springs bankruptcy attorney at The Law Offices of Barry S. Mittelberg, P.A. to see what options are available. Schedule a free consultation today by calling (954) 752-1213.