STOP HOME FORECLOSURES BANKRUPTCY ATTORNEYS
IN NASHVILLE, TN

Unfortunately, bad things happen to good people, and if you fall behind on mortgage payments you are likely to find yourself facing a foreclosure sale on the house you worked so hard to keep. In these situations, a bankruptcy may be the best (or possibly only) opportunity available to stop the foreclosure sale and keep your home.

At Coles & Holton, we proudly dedicate our resources and whatever time is necessary to personally meet with you, thoroughly review your case, and discuss every potential option to prevent home foreclosure. Indeed, on many occasions we have spent the entire day meeting with prospective clients and have successfully stopped a foreclosure sale on the eve of the advertised sale date. It sounds crazy that anyone would wait that late to take some action to save their house, however, the sad reality is that many of these clients were either told by their mortgage company or the bank holding their loan that a modification was still pending and the sale was postponed. Some were completely unaware that a foreclosure sale was scheduled at all!

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                As explained earlier, the filing of a bankruptcy case – whether a Chapter 13 or Chapter 7 bankruptcy – immediately imposes an automatic stay against any attempts a creditor may take to collect debts from you. This means that once your case is filed your mortgage company is legally obligated to immediately cease the foreclosure process and remove your property from the auction list. The main benefit to the Chapter 13 bankruptcy is that it can guarantee that you keep your home and provides up to 5 years to bring current whatever you owe in mortgage arrears, late fees, interest, penalties, etc. Unlike the Chapter 7, creditors in a Chapter 13 case are much more limited in the rights they have to reclaim their collateral. For the most part, they have no choice but to comply with the proposed repayment plan so long as you keep up with those plan payments. The same goes for all the rest of your creditors as well – once your Chapter 13 case is filed, those creditors are then legally obligated to cease any further direct contact with you and deal with our office and the bankruptcy court only.

 

                The Chapter 13 bankruptcy process provides individuals with a number of advantages that would not be available outside of filing, such as freezing the interest on debts owed, reducing the amount paid for a vehicle down to the actual value from the contract balance, and in some cases, stripping a second mortgage, judgment lien or home equity line of credit off of the title to your home. In certain cases, these types of liens can be legally “stripped” or “avoided,” which converts those debts to an unsecured status and, ultimately, removes the claim those creditors have to your home. When your bankruptcy is finished and the discharge from the court is received, you generally are released from the obligation to pay whatever outstanding balance remains on these liens along with the rest of your debts.

 

                One way to halt the auction of your home is by filing a Chapter 7 bankruptcy case. As discussed earlier, a Chapter 7 bankruptcy filing triggers a special set of federal protections that can be immediately enforced against your creditors. These protections, which stem from the automatic stay against execution on any collections efforts, will legally prohibit the bank from going forward with the sale or auction of your home by foreclosure. It doesn’t matter if you’re behind on payments, or if a lawsuit has been filed, or that the foreclosure sale has already been scheduled and noticed. Once filed, your mortgage company is required to cease the sale at once.

 

                It is important to keep in mind that Chapter 7 is generally best used as a short term solution to stopping a foreclosure. It will postpone the sale, but cannot guarantee that you keep your home in the long run. In Chapter 7 cases, it’s ultimately up to the mortgage company whether or not they will agree to allow you to remain in the house. However, it can provide some breathing room by buying some extra time to work out a payment plan, apply for a mortgage modification, refinance the loan, come up with the money to bring the back payments current, or otherwise get your finances in order in general.

Contact us today for a free consultation!