Have you been falling behind on your mortgage payments? Received a foreclosure notice in the mail? If so, it’s important to take action immediately against it. While the potential of foreclosure can be terrifying and overwhelming, there are options. Just because you received a foreclosure notice doesn’t mean that you have to lose your home. Don’t be embarrassed that you’re receiving the letters, or ignore them. Plenty of people have been in your situation, and our law firm is here to help.
In today’s blog post from the bankruptcy attorneys at McCue Law Office in Bangor, we’re sharing a few ways that you can potentially stop a foreclosure and save your home. Continue reading to learn more, and if you’d like to schedule a free consultation with a bankruptcy lawyer, contact our Maine law firm today.
Bring Your Loans Current
If possible, try to pay the total amount past due on your loan. This is called bringing the loan current, and doing so can stop the foreclosure process. Many people are unable to pay off the default amount and the extra fees, but if possible, tell your lender that you will pay that and they should stop the foreclosure process.
Work Out A Compromise With Your Lender
Lenders would rather work out a compromise with you than go through the foreclosure process and put the house up for auction. Don’t ignore letters about your missed payments; instead, try to work out a compromise that allows you to get back on track with your payments.
Modifying the terms of your loan may reduce your monthly payments or your interest rates, helping you get back on track with your payments. You may also be eligible for the government Homeowner Affordability and Sustainability Plan (HASP), which allows you to restructure your mortgage. HASP is specifically designed to help homeowners who owe more than their home is worth or have more debt on their home than income, and it’s important to look into because it may help you keep your home.
Sell Your Home
While you don’t want to lose your home, foreclosure may be inevitable, and to avoid some of the impacts (such as credit impacts) that come from foreclosure, you can attempt a short sale on your home. Before you do this, you’ll have to consult with your lender and get permission, otherwise, you will be in legal trouble. If this is something you are considering, it might be helpful to schedule an appointment with a law firm to make sure everything is in order.
The goal of making a short sale is to sell the home for enough money that you can pay back what you owe to the lender. If you’re not able to sell the home for that amount, it’s not a good option, because you may have to pay the remaining balance of the loan. Be sure to do your research before moving forward with this option.
Bankruptcy is always a financial last resort, but it can provide you with significant debt relief and give you a financial fresh start. If a foreclosure sale is imminent, you can stop the sale by filing for bankruptcy. Filing for bankruptcy provides you with an automatic stay, which will stop the foreclosure and prohibit the bank from foreclosing on your home or trying to collect the debt you owe.
If you want to keep your home, filing for Chapter 13 bankruptcy can help. If you’re looking to buy yourself some time by stalling the foreclosure, filing for Chapter 7 bankruptcy may be right for you.
Chapter 13 bankruptcy allows you to restructure your debt and create a payment plan to repay debts (some in part, some in full) over the course of three to five years. Unlike Chapter 7 bankruptcy, or liquidation bankruptcy, Chapter 13 bankruptcy allows you to keep some of your assets, such as your home. With the restructured plan, you can repay any delinquent mortgage payments you have in a time frame that works for both you and the lender. More so, you will likely pay a fraction of your unsecured debt (such as credit card debt or underwater second and third mortgages) through the bankruptcy agreement.
Considering Filing For Bankruptcy In Maine?
Our bankruptcy attorneys are here to help you if you need to file bankruptcy. Our team has more than 35 years of experience advocating for our clients, and along with bankruptcy, we also specialize in personal injury, social security disability, workers’ compensation, and real estate. Contact us today for a free consultation.