Mortgage Foreclosure: What Happens to Foreclosure in Chapter 7 and Chapter 13 Bankruptcy?

Bankruptcy:  Foreclosure Attorney in Fort Lauderdale

If your home is in foreclosure, bankruptcy offers two different outcomes depending on which bankruptcy chapter you file under.  The ultimate decision on whether to file a Fort Lauderdale Chapter 7 bankruptcy or a Chapter 13 bankruptcy will depend on whether you want to catch up on delinquent mortgage payments and save your house from foreclosure or whether all you need is a little more time and just want to delay the foreclosure sale.  Either way, filing a Fort Lauderdale bankruptcy is the solution. 

What is the difference between a Weston Chapter 7 Bankruptcy and Chapter 13 Bankruptcy on Mortgage Foreclosure?

Chapter 7 Delays Foreclosure

Typically, a Hollywood chapter 7 bankruptcy takes about 3 to 5 months from the day of filing until it’s closed by the bankruptcy court.  While your Miramar chapter 7 bankruptcy is open, your mortgage foreclosure cannot proceed because of the bankruptcy automatic stay that goes into effect upon filing the bankruptcy case.  If the bank wants to continue the foreclosure case or reschedule a foreclosure sale date, they must ask the bankruptcy court for permission to do so.

A mortgage foreclosure is the result of not making mortgage payments.  A chapter 7 bankruptcy does not do anything to help you keep your home because a Davie chapter 7 bankruptcy is the liquidation chapter in bankruptcy.  Filing a chapter 7 bankruptcy will therefore only delay the inevitable foreclosure sale.  It will also prevent the mortgage lender from attempting to get a deficiency judgment against you after the foreclosure sale because the bankruptcy will cancel the entire debt that you owe. 

Because mortgage lenders have many foreclosures happening at the same time, they usually don’t ask the bankruptcy court for permission to continue with the foreclosure.  The reality is that by the time they file a motion and set a court hearing, the chapter 7 bankruptcy is almost over anyway so they save the attorney fees and just wait.

Chapter 13 Bankruptcy Will Stop Foreclosure and Allow You to Save Your Home

If you want to keep your home by making up the missed mortgage payments, then chapter 13 is the bankruptcy chapter to file under.  A Pembroke Pines chapter 13 bankruptcy will immediately stop the foreclosure lawsuit or foreclosure sale.  Through the chapter 13 payment plan, you will have up to five years to catch up with missed payments while you continue making your regular monthly payment.  Chapter 13 forces mortgage lenders to take the delinquent mortgage payments over five years and you get to save your house from foreclosure 

Most people have other debt in addition to their mortgage.  A Davie Chapter 13 allows you to become debt free while you save your home from foreclosure making it easier to stay current on your mortgage after your bankruptcy payment plan is finished. 

If You’re Behind on Mortgage Payments – Get Help As Early As Possible

If your home is in any stage of foreclosure and your either need more time to find a new place or you want to save your home from foreclosure, bankruptcy offers a solution.  In either case, you must file a Fort Lauderdale bankruptcy petition before the date of the foreclosure sale.  A chapter 7 or chapter 13 bankruptcy can stop a foreclosure sale as long as it is filed before the sale starts.

The Bankruptcy Law Firm of Orfelia Mayor is here to answer all of your bankruptcy law questions.  Our Cooper City office is easily accessible from Miramar, Pembroke Pines, Weston, Fort Lauderdale and Hollywood.  We are also just 14 to 20 minutes away from Coral Springs, Davie, Tamarac, Sunrise and Plantation.  Call our bankruptcy law office today for a free bankruptcy consultation.