Financial challenges are stressful, but there is almost nothing worse than the threat of possibly losing your home. If you receive notice that your home is in foreclosure or notification of a sheriff sale, don’t lose hope.  While you’ll need to act quickly, saving your home may still be possible.  You may think that you’ve exhausted all of your options, but have you considered bankruptcy?

Is It Too Late to Save Your Home?

It is always beneficial for a person to seek counsel regarding their financial and legal options as soon as notices of foreclosure begin to arrive. While these notices are daunting, it is wise to confront the situation head-on by exploring the various ways to deal with overwhelming debt and to stop additional fees and charges from accruing.  Acting promptly will save you money in the long run.  If the foreclosure process continues, your home will be scheduled for sale.

Even if you have put off seeking advice about how to deal with the foreclosure and you find yourself on the eve of a scheduled sale, an emergency bankruptcy may still be an option.

How Can Chapter 13 Help You Keep Your Home?

Chapter 13 bankruptcy offers many benefits for people who want or need to stay in their homes, even when behind on mortgage payments. This option allows people not eligible for Chapter 7 bankruptcy or those with a regular income to make a plan to repay their debts. It includes the following benefits:

  • Offers the ability to pay delinquent mortgage payments over time
  • Allows additional time to try to sell your home and realize the equity that you have built up
  • Allows for the repayment of other secured debts, such as a car loan
  • Allows the debtor to keep assets while paying off debts over three to five years
  • May allow for complete discharge of second mortgages not backed by market value

Chapter 13 bankruptcy is not the best choice for everyone, but when faced with the imminent threat of losing your home, it may offer you relief and time needed to effectively confront your debt. You have the right to know your consumer bankruptcy options, whether you just received your first past-due notice or it is the eve of a sheriff sale.

Jennifer Alderfer has contributed her considerable experience in bankruptcy matters to Network Magazine and in her blog posts.  In addition to bankruptcy, Jennifer practices real estate law, business law, municipal law and litigation.