Receiving notice that the bank is seeking to foreclose your mortgage can raise what seems like a million questions in your mind. You might first be wondering if you should try and catch up the past due payments, or if you should try to get your lender to modify the terms of your note and mortgage to something you can afford. It is also common for those facing foreclosure to consider filing bankruptcy to stop the foreclosure from going further and it is even a common occurrence for people with looming foreclosure action staring at them to simply vacate the premises. In order to make the best of a difficult situation, you need the help of a knowledge professional to guide you towards choices that work.
While bankruptcy will certainly stop a foreclosure, packing up and moving out will not have the same effect. Here’s why:
- A bankruptcy case is a legal matter with rules all parties have to follow. One of the most important rules is that when the case is filed all creditors are immediately prevented from taking action to collect a debt, to repossess personal property like a car, or to foreclose on real property like your house. Without the protection bankruptcy offers, the mortgage holder is not required to stop any action that is in progress or about to be initiated.
- Simply vacating a property does not relieve you of the financial obligation that goes along with having signed a contract to purchase that property. So even if you move out, the lender will still consider you liable for the unpaid debt and if the debt remains unpaid, foreclosure is usually the next step.
- In order to make sure the title to the property is clear, a foreclosure is often necessary even if you have agreed to turn over the keys.
There are alternatives, such as offering a deed back to the lender in lieu of the foreclosure, or trying to short sale the property. In both of these instances you need competent representation to negotiate these things on your behalf. Call us today for more information.
For more information about bankruptcy, contact us at www.DsouzaLegalGroup.com. We will help by coming up with solutions that work for you.