Are you behind on your mortgage payments? If so, you are one of many Pennsylvania residents in such a position. While foreclosure rates have declined over the years, numerous individuals have still found themselves struggling to stay financially afloat, making it difficult for them to meet their obligation to their mortgage lenders. This is when they start considering bankruptcy.
A mortgage lender is not going to take your home after one missed payment. In fact, they generally let things slide for a few months before they are willing to take action. Before you get to that point, though, it is wise to look at foreclosure defense strategies that may benefit your situation — such as bankruptcy.
Bankruptcy is something that most people try to and want to avoid. It is understandable that it is not a perfect system and there are some negative points regarding utilizing bankruptcy; however, it can stop the foreclosure process in its tracks if filed in a timely manner. Wondering how?
If you take the leap and file for bankruptcy, regardless if it is a Chapter 13 or Chapter 7, the court will issue you an automatic stay. This means that all of your creditors, mortgage lenders included, will have to stop their attempts to collect or seize your property. The court will decide later whether you get to keep your home.
Does bankruptcy always work?
It all really depends on when you file and if you stay on top of your payments after the fact. If the bank has already begun the foreclosure process on your home, it may be too late for the court to step in and stop it. An experienced bankruptcy attorney can review your case and let you know if it is actually an option for you.
If it is still an option for you and your bankruptcy receives court approval — and the bank allows you to keep your home by keeping to a restructured payment schedule — you have to stick to that schedule or your lender may once again begin the foreclosure process.
The key to stopping foreclosure is…
Bankruptcy is not the answer for everyone, but there are those in Pennsylvania for whom it is the best option for stopping the foreclosure process. The key is not waiting too long before getting help.