Get Help From an Attorney When Confronting Foreclosure

June 25, 2011

Get Help From an Attorney When Confronting Foreclosure

More and more struggling homeowners are making their way through the threat of foreclosure on their own. From attempting to negotiate in good faith with their lenders (a difficult task) to showing up to court to contest the foreclosure, some desperate homeowners are taking a sink-or-swim approach to navigating the foreclosure process.

For many homeowners, this is a mistake.

Lenders have been notoriously difficult in negotiating loan modifications. For homeowners unfamiliar with the process, lenders may not take offers seriously or respond timely to the homeowner.

As for representing yourself in court, the foreclosure process gets more complicated as the case goes on. But you may have a legitimate defense. For example, if you were subject to predatory lending, and the lenders violated the Truth in Lending Act, you may be able to have the foreclosure case dismissed. In fact, in some circumstances the bank could end up owing you money.

Chapter 13 Bankruptcy

Even if the bank did not break any laws and is conducting the foreclosure correctly, you may still be able to save your home. Chapter 13 bankruptcy is often the most reliable way to stop foreclosure. Any time you file for bankruptcy your lenders cannot proceed with foreclosure. The stay isn't permanent, but at least until you can organize your debt and begin a payment plan so your house will not be foreclosed.

In a Chapter 13 bankruptcy the filer makes a payment plan for his or her debt. For secured debt (debt that the lender or creditor has a lien on, like a home) creditors have the right to reclaim the property if the borrower does not fulfill the obligations of the loan. When a borrower cannot make payments on time, the borrower is not fulfilling the terms of the loan and the lender can foreclose.

For Chapter 13 bankruptcy filers, unsecured debt like credit cards and medical bills can be forgiven whole or in part. Only disposable income, if the bankruptcy filer has any, will go towards the payment of unsecured debts. This gives the filer more money to pay off the debts on the home. The bankruptcy filer then pays what he or she owes the lender over time, usually three to five years, while still making current payments on the house.

Speak to a Bankruptcy Attorney

Only an experienced bankruptcy attorney can help you to decide if Chapter 13 bankruptcy is right for you, or if your lender violated the Truth in Lending Act. Consult with an attorney in your area to discuss your particular situation.

Article provided by Law Offices of David I Steinberg
Visit us at http://www.dsteinlaw.com