Money is tight, bills are piling up, and you’re not sure what to do. No matter how hard you try, it just is not enough to makes ends meet. You start getting “Notice of Default” letters in the mail and they won’t stop calling you. Your home is about to go into foreclosure. Your mind immediately starts racing to thoughts of filing Bankruptcy, the lender for your home can’t take your home way if that happens……

Not entirely true!!

There are 2 different types of Bankruptcy you can file, Chapter 7 and Chapter 13. They are very different from each other and how they help, so please do your research before making a choice. Bankruptcy is usually filed after 2-3 payments have been missed on the mortgage of the home. Once the bankruptcy is filed, the process of foreclosure will be postponed automatically until the bankruptcy is finalized. This process will usually take 3-4 months.

You can file Chapter 7 Bankruptcy or “Automatic stay,” but this is only temporary. The court puts a temporary hold on your creditors, including your lender. Although, not all creditors will be put on hold, only unsecured ones, like credit cards. Just know that debt, taxes, child support, alimony and student loans are not included the Chapter 7, nor can it give you relief from secured creditors including your lender. Chapter 7 is only effective for as long as the court wants it to be, they can change it at any time by granting the lenders motion for “relief from automatic stay.” At that point, the process will proceed with the foreclosure.