Yes, a Chapter 13 bankruptcy case can stop the foreclosure sale immediately. In a Chapter 13 case you can catch up on your mortgage arrearage over time as well as deal with your other debts. This is a very powerful tool. If you live in Louisville or its surrounding areas and your home is in foreclosure you should consider Chapter 13 bankruptcy.
The bankruptcy automatic stay will stop a pending foreclosure sale up to the time the property is sold at auction. After we stop the foreclosure sale we will propose a plan to the bankruptcy court to deal the your arrearage and other debt. Once the plan is approved, you will make regular payments to the bankruptcy trustee for your past due debt. You can take up to 60 months to catch up on the past due amounts and reinstate your home loan. Even better, the mortgage company must accept an approved bankruptcy plan.
But what if you can’t afford your regular mortgage payments? For a Chapter 13 case to work, you have to be able to resume making your regular, ongoing mortgage payments and, at the same time, pay an additional amount into your Chapter 13 plan to cure the arrearage. If you can’t make your regular payment, your plan is not feasible, and it won’t be approved by the court. You also need to understand that Chapter 13 won’t lower your mortgage payment. (There is an exception to this with a second or third mortgage that’s wholly unsecured)
In addition to stopping foreclosure sale on your home, Chapter 13 also allows you to remove certain judgment liens against your home as well as undersecured mortgages.
If you’re a homeowner in Louisville, Elizabethtown or the surrounding communities, and you’re worried about losing your home to foreclosure, Chapter 13 bankruptcy may be able to help you stay in your house and keep your property. However, it is vital to act swiftly. The longer you wait to speak with an attorney the fewer legal options you may have. To discuss Chapter 13 bankruptcy in a free and confidential legal consultation, contact me today.