The most recent foreclosure statistics present a disheartening image of the real estate market and the American economy. According to RealtyTrac, an average of 1 in every 634 housing units received a foreclosure filing in December of 2011. The states with the highest rates of foreclosure were California, Florida, Nevada, Arizona, Georgia, Michigan and Illinois. As homeowners across the country are facing foreclosure or threatened foreclosure, it is important to consider what remedies are available.
Filing for bankruptcy is one way that foreclosure can be halted or even avoided entirely. When a person files a bankruptcy petition, this places what is called an "automatic stay" on all debt collection proceedings against the petitioner. This includes foreclosure. In a Chapter 7 filing, this may give a debtor time to figure out how to sell or surrender the home by way of a deed in lieu of foreclosure or a short sale. In a Chapter 13 filing, the automatic stay may not only buy the homeowner time to determine what to do, but past due mortgage payments and penalties may actually be included in the homeowner's repayment plan - enabling him or her to actually save the home and avoid foreclosure.
Then catch your breath. And with the immediate crisis at bay for at least a little while you can start asking the bigger questions, like: Do I want to keep my house" Do I want to hire an attorney? Which one: a bankruptcy attorney, or an attorney who specializes in loan modifications? These are all big questions that deserve careful thought.
And if you spend $2,000 on a bankruptcy attorney in a last minute ditch effort, you may have wished you spent the money on a different attorney, or maybe an attorney who specializes in loan modifications. And if you don't have the funds right now but your home is scheduled for a sale tomorrow, you have to do something fast, because the bank won't wait for you. If you don't have the $2,000 for an attorney to stop your sale today, then you sure won't need one after they take your home tomorrow.
But how do I make sure I get this filed right so it stops the sale? You sure don't want to get this wrong, because if you screw up, they could take your house. How about those on-line filing services? You simply don't have time to determine if they will do it right. And what if they don't file on time? There is no substitute for walking into the bankruptcy court with documents that you know are correctly filled out, and handing them to the clerk yourself. You get a time stamped receipt and know you got the job done.
If foreclosure has already begun --meaning a sale date has been made-- you still have time to save your home. The first thing you need to do is contact your lender and find out what arrangements can still be made. Tell them your situation and how much you can afford. Remember that banks don't want to foreclose, they would rather make a deal with you to help you pay your mortgage. In some states you have until the home is sold to reclaim it, and in many states you have a redemption period even after, although once you reach the redemption period you will have all outstanding mortgage balances and attorney fees to pay.
Stopping your foreclosure by filing your own chapter 13 bankruptcy won't fix things permanently, but it stops the immediate crisis so you can think clearer and live to fight your lender another day. Once your sale is stopped, take a deep breath, and with your head a little clearer, you can start making the bigger decisions.The George Osborne budget has meant that that at least up to 600,000 public sector jobs could be cut over the next five years.
Here's the thing: none of those means you are in foreclosure.If you get a letter from your bank telling you you are in foreclosure, you are not in foreclosure.Even if you are six months behind with the mortgage and you've received four letters from the bank saying you are in foreclosure, you are not in foreclosure.This is important, so I'll repeat it. You are not in foreclosure because your bank says you are.Only one of two things can notify you officially of foreclosure.A Notice of Trustee Sale.A Notice of Sheriff's Sale.Once you receive either of those, you are officially in foreclosure. Your house will be auctioned, usually in about 90 days' time, depending on which state you live in.
This policy can be purchased from a high Street broker or is often now offered with your mortgage; but a cheaper method is to look for a standalone provider on the internet.However as with all insurance policies there is small print that you must be very aware of to ensure that this is the right policy for you. The first and most important is the "exclusion period". This is defined as from the start date of your policy and during this period you must not be made aware of impending unemployment. Providers vary with the length of this and as unemployment claims have soared so to have the Income protection exclusion periods. It is worth shopping around but the average is about 120 days.
The exclusion period means that buying Income Protection Insurance is something you do whilst you are in work; if you wait until you have been told of your redundancy it is too late.Always read the small print to ensure that the Income protection Insurance you have chosen is right for you. There is no point in purchasing a policy as a self employed person to then find when you claim that you are excluded. Similarly there are exclusions for previous existing illness conditions. If you read the policy carefully there is every reason that should the worst happen your home, lifestyle and family will be protected from the worst of the financial storm that may be approaching. You need however to act rather than wait.
Filing for bankruptcy is one way that foreclosure can be halted or even avoided entirely. When a person files a bankruptcy petition, this places what is called an "automatic stay" on all debt collection proceedings against the petitioner. This includes foreclosure. In a Chapter 7 filing, this may give a debtor time to figure out how to sell or surrender the home by way of a deed in lieu of foreclosure or a short sale. In a Chapter 13 filing, the automatic stay may not only buy the homeowner time to determine what to do, but past due mortgage payments and penalties may actually be included in the homeowner's repayment plan - enabling him or her to actually save the home and avoid foreclosure.
Then catch your breath. And with the immediate crisis at bay for at least a little while you can start asking the bigger questions, like: Do I want to keep my house" Do I want to hire an attorney? Which one: a bankruptcy attorney, or an attorney who specializes in loan modifications? These are all big questions that deserve careful thought.
And if you spend $2,000 on a bankruptcy attorney in a last minute ditch effort, you may have wished you spent the money on a different attorney, or maybe an attorney who specializes in loan modifications. And if you don't have the funds right now but your home is scheduled for a sale tomorrow, you have to do something fast, because the bank won't wait for you. If you don't have the $2,000 for an attorney to stop your sale today, then you sure won't need one after they take your home tomorrow.
But how do I make sure I get this filed right so it stops the sale? You sure don't want to get this wrong, because if you screw up, they could take your house. How about those on-line filing services? You simply don't have time to determine if they will do it right. And what if they don't file on time? There is no substitute for walking into the bankruptcy court with documents that you know are correctly filled out, and handing them to the clerk yourself. You get a time stamped receipt and know you got the job done.
If foreclosure has already begun --meaning a sale date has been made-- you still have time to save your home. The first thing you need to do is contact your lender and find out what arrangements can still be made. Tell them your situation and how much you can afford. Remember that banks don't want to foreclose, they would rather make a deal with you to help you pay your mortgage. In some states you have until the home is sold to reclaim it, and in many states you have a redemption period even after, although once you reach the redemption period you will have all outstanding mortgage balances and attorney fees to pay.
Stopping your foreclosure by filing your own chapter 13 bankruptcy won't fix things permanently, but it stops the immediate crisis so you can think clearer and live to fight your lender another day. Once your sale is stopped, take a deep breath, and with your head a little clearer, you can start making the bigger decisions.The George Osborne budget has meant that that at least up to 600,000 public sector jobs could be cut over the next five years.
Here's the thing: none of those means you are in foreclosure.If you get a letter from your bank telling you you are in foreclosure, you are not in foreclosure.Even if you are six months behind with the mortgage and you've received four letters from the bank saying you are in foreclosure, you are not in foreclosure.This is important, so I'll repeat it. You are not in foreclosure because your bank says you are.Only one of two things can notify you officially of foreclosure.A Notice of Trustee Sale.A Notice of Sheriff's Sale.Once you receive either of those, you are officially in foreclosure. Your house will be auctioned, usually in about 90 days' time, depending on which state you live in.
This policy can be purchased from a high Street broker or is often now offered with your mortgage; but a cheaper method is to look for a standalone provider on the internet.However as with all insurance policies there is small print that you must be very aware of to ensure that this is the right policy for you. The first and most important is the "exclusion period". This is defined as from the start date of your policy and during this period you must not be made aware of impending unemployment. Providers vary with the length of this and as unemployment claims have soared so to have the Income protection exclusion periods. It is worth shopping around but the average is about 120 days.
The exclusion period means that buying Income Protection Insurance is something you do whilst you are in work; if you wait until you have been told of your redundancy it is too late.Always read the small print to ensure that the Income protection Insurance you have chosen is right for you. There is no point in purchasing a policy as a self employed person to then find when you claim that you are excluded. Similarly there are exclusions for previous existing illness conditions. If you read the policy carefully there is every reason that should the worst happen your home, lifestyle and family will be protected from the worst of the financial storm that may be approaching. You need however to act rather than wait.
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