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Can Filing Bankruptcy Stop Foreclosure

By: craig

Foreclosure happens when you fail to make up the payments for the money you owe to a credit company. It is a legal process in which, having put up the deeds to your home or property in order to borrow money, you lose your rights to the mortgaged property because you defaulted to live up to the terms of the loan contract. Until this happens you actually retain possession of home, and it looks as though you actually do own it; but the moment you start to fail in violation of that loan terms and meet other obligations specified in the bond or mortgage, foreclosure is effected by your lender, which is either a bank or a mortgage firm.
To effect a foreclosure, the lender usually has to apply to a court for the authority to sell the home under the power you have consigned to them in your loan terms. They then use the money received from the sale of your home to apply to all debts on your home and the payments due to them. This may take a single day if the credit firm can pull enough strings to make it fast, but the process often takes weeks to process. If you are going to stop this procedure, you are going to have to do it before the filing is made; and if you are unable to do that, you had better be able to pull a justifiable rabbit out of your hat before the day the ruling is made.
There are quite a few stop foreclosure options you may explore to be able to hold on to your home, and bankruptcy is one of them. Often, this alternative is saved for a last resort when all else has failed, and with good reason too. It can be made especially into a difficult process because frequently, the end product of it is that you get to walk away from the whole mess without paying what you owe to the lender" or something like that.
Bankruptcy is a legal proceeding also; one in which you get to declare your inability to pay your debts as they become due. You may cease the chance to be discharged from continuing personal liability, or you may ask the court to give you the chance to reorganize financially through an extended period of time in which to pay all or a proportion of your mortgage.
Simple though this seems, the signing into law of the Bankruptcy Abuse Prevention and Consumer Protection Act in May of 2005 has changed a lot of things. To start with, there is now allowance in the law to preclude states from writing their own individual bankruptcy laws, and secondly, it makes it harder for folks to file for bankruptcy under Chapter 7 of the bankruptcy code.
With a Chapter 7 filing, you would have been able to liquidate or lower some debts in exchange for forfeiting some assets, and that would be the end of it. But because some more inflexible criteria that have been included in the process, you simply may not qualify; you may want to talk to your legal counsel about it.
You still have a chance with a Chapter 13 bankruptcy filing. If you win, it simply means that you will still have to make up for what you owe to the credit firm, except that you may obtain some relief from the court to repay your debts at a set lower amount each month per month over a period of three to five years.
Better than nothing, I suppose. But look on the bright side - you still get to keep your home, so sure, bankruptcy can stop foreclosure if done right, and if you meet all the necessary requirements.

Article Source: http://www.webmarketingiq.com

For more information on filing for bankruptcy visit : www.stopforeclosuredigest.com or even stopforeclosuredigest.com/help/home/

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