Living with the fear of losing a home is very unpleasant, and worry increases if the homeowner has minor children. Many mortgage companies refuse to negotiate with people who are delinquent, but fortunately, bankruptcy offers a way to stop harassing phone calls and letters. In fact, when one files for bankruptcy, the judge issues an automatic stay which stops foreclosure proceedings. Bankruptcy does not mean debts are excused; however, the process offers some options for debtors.
A good place to start is by visiting an attorney who helps to stop foreclosures in Gainesville, GA. They explain the process and whether or not one can keep their home. Visit website and schedule a consultation today. A major benefit of bankruptcy is that it eliminates some unsecured debts, which generally involve credit cards. In addition, bankruptcy blocks other collection activities like garnishment and repossession. On the other hand, bankruptcy does not erase past-due child support and alimony, and likewise, it does not erase past-due taxes owed to federal and state governments.
Chapter 7 and chapter 13 are the most used types of bankruptcy. Chapter 7 is for people who want to liquidate most of their assets to pay off debt. Some assets are exempt depending on the state one lives in. Chapter 13 is the only bankruptcy that will stop foreclosures in Gainesville, GA. Mortgage companies must agree to a plan that gives the debtor some relief, for instance, many plans allow the debtor to pay arrears over time. Also, the attorney and bankruptcy trustee work together to reduce secured debts, but this only occurs if the debts are worth more than the property securing them. An example would be a house that is appraised for $140,000 and the mortgage is $200,000.
Chapter 13 allows consumers to repay debt and keep most of their property. The bankruptcy trustee comes up with a monthly-payment amount for the consumer to pay. It will be difficult to make the payments because it takes most of one’s income; however, struggling to make the payments pays off in the long run. When the bankruptcy is discharged, the individual has their property and they should not have many debts.
