Foreclosure is a troubling epidemic that was brought to the forefront of America's conscious with the burst of the housing bubble several years ago. Many Americans who are tough working and honest folk are locating themselves falling behind on mortgage payments and getting threatening messages from their moneylenders. If this is you then bankruptcy may be your way out but it may not be an enduring way out.
If you file bankruptcy before you're sued for foreclosure then you have the luxury of keeping an impending foreclosure at bay. The "automatic stay" goes into effect when you file bankruptcy which means all your lenders are barred from continuing collection activities. This includes your lender going through with foreclosure proceedings.
The Automatic Stay Does Not Last Forever
If Chapter 7 bankruptcy is the type you filed then the bankruptcy is over after all your nonexempt possessions have been liquidated and creditors have been paid off. If your mortgage debts were not paid in full then you'll most likely hear from your lender after the bankruptcy has been filed and automatic stay has been lifted. Chances are they will be willing to cooperate with you because most moneylenders would rather take a hit on the interest to avoid the hassle of foreclosure.
Foreclosures are happening at an alarming rate all across the country. The best way to avoid one is to retain an open line of communication with your mortgage lender. As stated above, most lenders do not want to foreclose unless positively necessary so they'll more than probably be willing to work with you on reorganizing a payment plan. If you're worried about how filing bankruptcy will impact your current house or your ability to buy a house in the future then speak to a local bankruptcy attorney today about your state's laws concerning bankruptcy and foreclosure.
