Making The Hard Choice Between Bankruptcy Or Foreclosure | Mortgage

Making The Hard Choice Between Bankruptcy Or Foreclosure

by CobyT.Lucas

Some people consider whether or not they should file bankruptcy or just let their mortgage lender foreclose on them? It is not usually easy and is rarely acceptable to make a decision that is black and white. A mortgage lender will file a foreclosure action when it is not paid its monthly mortgage payments. There is only on way to stop this from happening and that is pay the mortgage lender.

A mortgage loan can be compared to a car loan in the sense that if you don not pay it back, the car will be taken or repossessed by the bank. By not making the monthly mortgage payments you can ultimately wind up with the same fate of losing your house.

Bankruptcy is a last resort legal way to get out of paying your debts if you are unable to do so. These steps put a halt to proceedings against the debtor while the person is in bankruptcy. At this point the lender has to stop all planned actions including a planned foreclosure action.

Even then to get relieve from the automatic stay a mortgage lender can go for legal action and when granted a stay can comfortably proceed with the further action. The truth is bankruptcy does not stop foreclosure nor does it allow you to keep your house with out paying the mortgage lender. Bankruptcy does not eradicate the situation; it merely slows the process down.

Although filing bankruptcy can't stop foreclosure, it provides an individual with additional time to repay a mortgage lender or facilitates paying the lender of the mortgage. The debtor and a short time in which to come up with the needed funds, because the lender must suspend foreclosure when the debtor has filed for bankruptcy. It is the last resort for any debtor to declare bankruptcy when he is totally unable to meet his creditors commitments. Under such circumstances, he may be discharged by some unsecured debts but under mortgage, he shall be prepare to repay the debt within the given time as the debt is secured by tangible assets.

Under such circumstances, he may be discharged by some unsecured debts but under mortgage, he shall be prepare to repay the debt within the given time as the debt is secured by tangible assets. In addition, chapter 13 bankruptcy is a fee schedule that is court-ordered, and lets the debtor make payments on his mortgage to get up to date on his balance across a time frame.

Sadly, not every person will be eligible for bankruptcy, and even if they are found eligible, there are still legal costs. It may cost you more in legal fees than it does to just buckle down and make your mortgage payment. If you think that bankruptcy might help in stopping or avoiding foreclosure, speak with a licensed advocate. Bankruptcy is a complex process that is best handled by professionals.

This article is general information so if you have any questions of any nature about this subject then you need to talk with a lawyer licensed in your state.

DISCLAIMER: This article is provided as information only and is not to be taken as financial advice.

Learn about how you can payoff your home loan in a third of the time with a mortgage checking account and avoid going through mortgage meltdown. This and other unique content 'bankruptcy' articles are available with free reprint rights.