If You’re Facing a Foreclosure in Alameda, You Should Check Out Chapter 13 in Oakland Bankruptcy Court.
Welcome to Pixton Bankruptcy Law. If you’re facing foreclosure, you’re in the right place. As you’ve come to understand, foreclosure means that your bank lender can take your house and sell it out from underneath if you’ve fallen behind.
If you’re looking for a quick understanding of how the foreclosure process works in Alameda, Oakland, Hayward and the rest of the Bay Area, click here.
If you already understand that the clock is ticking, you know that you need to do something sooner rather than later or you’ll soon be an ex-homeowner. Once that foreclosure sale happens, it’s impossible–or at least nearly impossible–to get your house back.
So what can you do if you’re home is scheduled for auction?
First, you can choose to do nothing. If that’s the case, your home will be gone–either purchased by a new owner or “taken back” by the bank if no one else bids on it.
Second, you can contact the lender directly and try to work out some sort of loan modification. Oftentimes, this can at least delay a foreclosure while you complete the modification application process. You need to be careful, however, because the lender can still go forward with the foreclosure. It isn’t bound to grant a modification and it isn’t required to sit around while you apply for one. The lender may choose to cooperate, but it can take back its cooperation at any time and you’ll be out of luck.
Third, you can sell your house quickly if there’s equity, or you can short sell your house (less quickly) if there’s no equity. Read up on the realities of the short sale here. If you sell the house, your mortgage problems are over, but you also no longer own your home and will have to move elsewhere.
Fourth, you can file a bankruptcy case. Here’s where I come in as an Alameda bankruptcy attorney with tons of experience doing this kind of thing. Your options are usually chapter 7 or chapter 13, two dramatically different kinds of bankruptcy cases. If you live in Alameda and are considering bankruptcy, you need to understand both. On this page we’re going to focus on chapter 13 because that’s the one that will best help you save your home. Click here for more on chapter 7.
Filing a chapter 13 will immediately get you two things: time and peace. You need both in order to figure out how to protect your home. As long as you haven’t recently filed a previous case, the filing of your case creates what’s called the “automatic stay.” This just means all your lenders have to leave you alone and quite trying to collect from you. This applies to foreclosure sales! So your lender can’t foreclose–at least not without first asking for permission from the bankruptcy judge.
Now that you’re protected by the automatic stay, you are in good shape to do a lot. You can complete a short sale if you choose. You can complete a loan modification–or even apply for one after you file! Or, if you just needed time to catch up on your payments, you can start making the mortgage payments again and take up to five years (60 months) to catch up on the missed payments from before the case was filed.
Chapter 13 is not a magic wand that we can wave and permanently fix all your home loan problems. But it is
