Foreclosure & Bankruptcy

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CAN CHAPTER 13 BANKRUPTCY STOP FORECLOSURE

Chapter 13 Bankruptcy provides property owners who are on the verge of foreclosure or are in actual foreclosure with a useful tool to fight off foreclosure. The automatic stay that comes into effect when a debtor files bankruptcy is an injunction against creditors of the debtors. Through the automatic stay, creditors, including banks that may be seeking to foreclose against the debtor's property must stop ALL collection activities, including law suits such as foreclosure proceedings. The automatic stay is therefore, one means by which a foreclosure on our property may be stopped.

Secondly, Chapter 13 Bankruptcy can also be used to cure a mortgage default. When you fail to pay your mortgage on time and there is oustanding arrears your mortgage goes into deault. When your mortgage is in default the bank could start foreclosure proceedings against you. When this happens, ven if you offert the bank the mortgage installment payments that are over due the bank could refue it and demand payment of the entire principal. Therefore, by provding a means to cure the default, Chapter 13 Bankruptcy provides a basis to overcome foreclosure. It provides an opportunity for you pay the mortgage payments that are over due in installment over a period of 3-5 years through the Chapter 13 Plan.

Am I Eligible to File Chapter 13 Bankruptcy

You must be eligible to file Chapter 13 Bankruptcy. There are certain factors the court considers in determining whether you are eligible to file Chapter 13 Bankruptcy. It is recommended that you discuss your particular situation with a competent bankruptcy lawyer to determine whether Chapter 13 bankruptcy is right for you. Clic here to contact a Chapter 13 Bankrptcy lawyer now.

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