For many homeowners, the possibility of losing their home to the bank or their mortgage lender is frightening, particularly for those who don’t know how to avoid foreclosure. Because of a statutory security known as the automatic stay, filing for bankruptcy protection could be the only option for homeowners who are facing foreclosure and have a lot of other debt. As a consequence, it acts as a deterrent to foreclosure. Visit Foreclosure protection in Fort Worth.
Creditors, including mortgage lenders, are barred from collecting debts or enforcing liens as a result of the automatic stay. In the majority of cases, the eviction proceedings are covered by the compulsory hold. It’s important to realise that an automatic stay is just a temporary halt to foreclosure proceedings. If all of the following conditions are met, an automatic stay is not triggered:
- The homeowner declares bankruptcy under Chapter 7 at first.
- The court decides that your salary is too high to meet the means test requirements, and
- The homeowner then re-files for bankruptcy under Chapter 13 law.
As you would expect, filing for bankruptcy as a way to avoid foreclosure is a difficult task. It’s not something a homeowner can try to do on their own, particularly if the ultimate purpose of the bankruptcy is to prevent foreclosure.
While many homeowners assume they have little option but to file for bankruptcy, it is just a temporary reprieve from foreclosure. However, in many cases, an accomplished foreclosure defense lawyer may use the time to obtain a permanent foreclosure security solution. The following are some of the choices available to a homeowner who wants to avoid foreclosure:
Obtaining a modified mortgage through one of the federal government’s schemes, which allows you to lower your mortgage payments by altering the initial loan. Interest rate reductions, principal reductions, and other reforms are among the changes. This assistance is best handled by a foreclosure attorney who can negotiate with the lender to guarantee the homeowner’s safety at the conclusion of the process.
Obtaining a mortgage refinance through the Home Affordable Refinance Program, or HARP, which guarantees that the primary mortgage, as well as any secondary mortgages, are paid off and new terms are negotiated. New terms could include longer repayment periods, lower interest rates, and more. To ensure that these services are correctly implemented, a homeowner can consult with an experienced foreclosure lawyer.
Selling your house as a short-sale – a procedure arranged with your foreclosure lawyer to avoid being kept liable for summary deficiency judgments later. Many homeowners who agreed to a short sale without representation were later held liable for tens of thousands, if not hundreds of thousands, of dollars in lost revenue by the banks.