Foreclosure Defense Secrets.com

Over the next week, I will be counting down the eight best ways to avoid the foreclosure of your home.  Today, we start with a discussion of Bankruptcy, since that is the very last resort for anyone facing foreclosure.

8. Chapter 13 Bankruptcy- As of the date of this writing, the federal bankruptcy courts do not have the authority to restructure mortgages. However, this seems to be a popular method that is being used by homeowners and attorneys to delay foreclosure on their home. This is primarily used as a “stall” tactic and is not a “cure” all for your mortgage problems. In some cases Chapter 13 bankruptcy filings are being abused and portrayed by some bankruptcy attorneys as an effective way to “stop foreclosure” when in fact it is only and effective method to “delay foreclosure”.

In order to qualify for Chapter 13 bankruptcy you will have to have a steady income.The bankruptcy petition would need to be filed before the sale date of your property. After filing, you will propose a plan to repay the amount you fell behind on the mortgage. You will also begin to again pay your regular mortgage payments, which under the operation of law must be accepted by your mortgage company.

 A forced loan modification (non-mortgage) can be sanctioned by the courts if it is proved that the borrower cannot afford the current payments. The concept is similar to debt consolidation, but it permits you, the consumer(s), to pay unsecured debt down without accruing interest (student loans are an exception) and without having to deal with those annoying calls from debt collectors.

Under a typical plan, you make monthly payments to a court appointed bankruptcy trustee for generally three to five years. The amount of your monthly payment is determined by several factors such as the amount of debt you have, your ability to repay and the extent that you have assets. In exchange for stopping any and all collections activity, one proposes to pay all or, in specific circumstances, a portion of the debt through a Chapter 13 plan. The filing of a Chapter 13 bankruptcy stops ALL collection activity though something called the automatic stay. The automatic stay remains in effect during the life of the case unless the court orders otherwise.

You can always refinance or sell your home while under Chapter 13 if you wish to pay off the bankruptcy and move on with your life. The Chapter 13 stops the foreclosure immediately.  Learn more about how to stop the foreclosure of your home at www.ForeclosureDefenseSecrets.com.

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Sure the President is attempting to reduce the amount of foreclosures, but in reality, none of these plans will have any affect on the falling property values and the foreclosure epidemic as a whole.  Most people will not qualify for loan modification.  Of those that do, most will be unable to pay their modified rate because the value of their home will still be way lower than the principal amount owed to the bank.  Those that choose to file bankruptcy will take the chance that the bankruptcy court judge may reduce the principal owed to the bank, but most judges will choose not to do so and the borrower will be ruining their credit for at least 7 years from filing for bankruptcy.  The only way to truly protect yourself from foreclosure is to learn how to use the judicial system and the foreclosure process to your advantage.  Learn how to save your home at www.ForeclosureDefenseSecrets.com.

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