How to Stop Foreclosure in Arizona

Today, too many families are just one serious illness or one lost paycheck away from financial disaster. It might start out small with a late mortgage payment, but late charges add up fast. The next thing you know you are missing payments and your mortgage company already has zeroed in on beginning foreclosure proceedings.

When to Start Thinking About Bankruptcy

Once you are two months behind in your mortgage payments, your lender could be starting the foreclosure process. If you’re lucky, your lender might be willing to give you the option of a loan modification, but not all lenders will do that. You could consider your alternatives, including loan forbearance, short sale or turning over the deed to your lender. If none of those lender options are feasible, bankruptcy could help save your home, even if you have received a Notice of Trustee Sale, but you should file as quickly as possible.

What Bankruptcy Does To Stop Foreclosure

Once your file for Chapter 7 or Chapter 13 bankruptcy, the court will automatically issue an “Order for Relief” that gives you an “automatic stay” that orders your creditors, including your mortgage lender to cease their collection attempts immediately. This forces the stop of foreclosure proceedings until your bankruptcy is finalized, which will take about three to four months unless the mortgage company files a motion to ask that your home subject to the mortgage debt be removed from the bankruptcy proceeding.

Chapter 13 gives you the ability to set up a repayment plan to pay off your past due payments. However, you will still be required to make timely current payments. Chapter 7, however, could discharge your mortgage debt, but you will likely lose your home in the process.

If you are facing foreclosure, bankruptcy could protect you and your family from losing your home. Don’t delay, contact my office for a free consultation to determine whether bankruptcy is an option for you from a lawyer who cares.

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