Are you facing foreclosure? Thousands of people are dealing with the daunting reality of foreclosures in California and many of them are sitting idly by as time is racing against them. Don’t wait until it’s too late. You have many options available to you including loan modification, short sale, and Chapter 7 Bankruptcy or Chapter 13 Bankruptcy. Take the necessary steps today to help save your home from foreclosure.
Bankruptcy Protection
Filing bankruptcy can stop a foreclosure or a trustee’s sale. Upon filing for bankruptcy, there is usually an automatic stay that can stop the foreclosure sale. Lenders are compelled to wait until your bankruptcy is finished or file a motion for relief the automatic stay to proceed with the foreclosure. If you’re faced with a foreclosure you have two bankruptcy options:
In a Chapter 7 Bankruptcy, you can stop your home foreclosure temporarily however lenders can file a motion for relief to eventually sell your house. If you’re only a few months behind you may benefit from a Chapter 7 Bankruptcy by eliminating all of your credit card debt and provide you time to be current on your mortgage.
A Chapter 13 Bankruptcy can permanently stop a foreclosure or trustee’s sale, and is typically filed when you’ve fallen behind on your mortgage payments and need time to catch up on your arrears. You continue to pay your regular monthly mortgage(s) and also pay your arrears over a 3 – 5 year payment plan.
Don’t wait until the last minute to file. Plan ahead before the actual foreclosure sale or trustee’s sale date because you must complete a pre-petition credit counseling class and file a certificate of completion with your bankruptcy papers. If you file your certificate late the court can dismiss your case.
Loan Modifications
Loan modifications are programs that modify the loan payments, whether that’s through a reduced interest rate, extended loan terms or possible principal reductions. Unfortunately, most people have been unsuccessful with their modification efforts despite President Obama’s HAMP Program (Home Affordable Modification Program). If you obtain a loan modification, great, it will be one less thing to worry about among your other financial concerns. If, like many others, your modification was only a short term fix, then you need the help of a foreclosure defense attorney. Whether it’s through a Chapter 7 Bankruptcy or Chapter 13 Bankruptcy, your lenders may be more open to helping you after you file bankruptcy.
Short Sales
Foreclosure Attorney for Foreclosure Defense Including Short Sales, Loan Modifications, Chapter 7 Bankruptcy, Chapter 13 Bankruptcy and More
A short sale is a real estate sale where the sale price of the home is below, i.e. short of, the borrower’s existing loan balance. Lenders agree to sell the house at a moderate loss because the short sale amount represents the current value of the home and the likely selling price of the home. A short sale benefits the lender because they can find an immediate new buyer at a moderate loss rather than risk foreclosure, increased costs, abandonment or other damages. Many people file a bankruptcy to stop the foreclosure in effort to obtain a modification. If the modification does not work, they can still short sale the house so they can purchase of a new house sooner than if the house was sold through a foreclosure.
Tax Implications
You should note there are tax implications when the debt you owe has been reduced or forgiven, whether by a loan modification or short sale. The amount of debt forgiven may be considered taxable income and you will likely receive a Form 1099-C, Cancellation of Debt. However, the forgiven debt may be excluded from your income if you file bankruptcy, qualify under the Mortgage Debt Relief Act of 2007 or fall under some exclusion.
The Foreclosure Bankruptcy Lawyers at California Bankruptcy Relief can help you today. We represent clients who seek bankruptcy advice and look to discharge debt through Chapter 7 Bankruptcy or Chapter 13 Bankruptcy.
Contact Us and an experienced Riverside Bankruptcy Attorney or Orange County Bankruptcy Lawyer will evaluate your case and review your options.
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Common Tags: Short Sales, Foreclosure Laws, Loan Modification Programs, Home Loan Modification, Loan Modification, Bankruptcy Defense, Mortgage, Chapter 7 Bankruptcy, Chapter 13 Bankruptcy, Foreclosure Tax Implications, Foreclosure Defense Law Firm, California, Riverside CA, Orange County CA.
