Going it Alone During Foreclosure Can be Risky
It is possible to negotiate with your mortgage holder, but often these companies can be slow in responding and unwilling to negotiate, especially with someone who is not represented and therefore less aware of his or her rights.
June 19, 2011
Going it Alone During Foreclosure Can be RiskyHomeowners are increasingly trying to fight foreclosure without attorney representation, The New York Times recently reported. In worst-case scenarios, homeowners are even using unscrupulous home loan modification companies who defraud the homeowner and make his or her situation worse. Other homeowners simply do their best in communicating with the bank or mortgage holder on their own, learning as they go along.
It is possible to negotiate with your mortgage holder, but often these companies can be slow in responding and unwilling to negotiate, especially with someone who is not represented and therefore less aware of his or her rights.
A mortgage is a legal contract between you and the mortgage holder. Mortgage companies have a lien on your house, which is a legal device that allows the bank or mortgage holder to repossess the home if you are in breach of contract. Once you are behind on mortgage payments, you are in breach, and the mortgage holder can foreclose on your house. Foreclosure can be tough to halt, especially for non-judicial foreclosure states like North Carolina that do not allow a person to contest the foreclosure in court.
Chapter 13 Bankruptcy Can Prevent Foreclosure
Filing for bankruptcy is a difficult decision. However, Chapter 13 bankruptcy can be the surest way of keeping your home. As soon as you file for bankruptcy, the foreclosure process is halted until the bankruptcy is resolved.
In Chapter 13 bankruptcy, the filer's secured debt is reorganized. Secured debt is debt like your mortgage that has a lien on it. In order to keep the house, you would organize a plan to repay the overdue payments on your home over time, usually three to five years, while still making the current monthly payments.
Unsecured debt, like credit cards and personal loans, can be completely wiped away in a Chapter 13 bankruptcy. Instead of making interest payments on credit cards, for example, you could use that money towards mortgage payments you are behind on.
Consult A Bankruptcy Attorney
If you are worried about a possible foreclosure, consult an experienced bankruptcy attorney to further discuss how you may be able save your home.
Article provided by Terry D. Fisher
Visit us at http://www.durham-bankruptcy.com