With the recent downturn in the housing market and the economy as a whole, many people have found themselves unable to pay their mortgages. Others have found themselves saddled with mortgages that are now worth more than their homes in the current market. If you find yourself in way over your head with your mortgage, you might avail yourself of some of the refinancing options now available to you. But sometimes refinancing alone just isn’t enough. When that’s the case, you can turn to a bankruptcy attorney San Bernardino CA for help.
Chapter 7 Bankruptcy
A Chapter 7 bankruptcy involves discharging unsecured debts like credit card debts and medical bills. These debts are considered unsecured because there isn’t any collateral involved, so when you default on the debt, the lender has to sue you to recover the loss. By filing for Chapter 7 bankruptcy, you can eliminate your extra debts so you can concentrate on paying your mortgage and getting current with all your late payments. Typically, you must make up the back mortgage payments in a relatively short period of time—usually not more than one year.
Chapter 13 Bankruptcy
A Chapter 13 bankruptcy is designed to help debtors manage all of their debts. Instead of discharging your debts completely, under Chapter 13 you can instead create a flexible payment plan that will allow you to pay off all your debts within a period of 3 to 5 years. You won’t necessarily have to pay off the total debt amount either. Instead, a court will provide a ruling as to how much of the debt you must pay, based on your income. If you do wish to pay off the full amount, you will be able to get an exemption from interest.
Lien Stripping
If you have multiple mortgages to pay, your bankruptcy attorney San Bernardino CA may be able to have some of them discharged. Again, the goal is to eliminate other debts so you can focus on paying your mortgage.
Remember, there are plenty of rules and limitations related to this process of buying time for your mortgage payments by filing some sort of bankruptcy proceeding. Factors like your home’s value, your income, and whether or not the home is your primary residence will all play a role. The best way to figure out if a bankruptcy filing can help you get current with your mortgage and keep your home is to contact a bankruptcy attorney San Bernardino CA.
