Before you file for bankruptcy consult with an NJ Bankruptcy attorney. At the Law Offices of Patel and Soltis we offer free consultations to anyone considering bankruptcy. Whether you sign with us or not, we will go over all of your options and answer any questions you have. If you are considering filing for bankruptcy, you most likely are in a financial tight spot that we do not want to make worse, we rather you understand the importance of making an informed decision about bankruptcy than make you pay for a consult.
If you are facing Foreclosure and are considering bankruptcy, you need to understand how bankruptcy can help you, and the possible pitfalls you may face if your bankruptcy is handled improperly. If you make too much money, have too much debt your options can be limited to the type of bankruptcy you are filing.
For instance, if you have equity in your property, and chose to file for a Chapter 7 bankruptcy your home can be sold by the Chapter 7 Bankruptcy Trustee to pay your unsecured debts. However, if you do not have any equity or very little equity, the bankruptcy trustee may choose to abandon your property and not make you sell the property. So, people who are underwater on their home and meet the Chapter 7 Means Test can file for a Chapter 7 bankruptcy prior to a sheriff sale and the sale would be stopped until the bankruptcy is completed or the automatic stay is lifted.
Even if the Homeowner surrenders their property in Chapter 7 the bank will need to complete the foreclosure process to take ownership, unless the homeowner agrees to leave. In many cases, a homeowner can be paid by the bank to leave. We have negotiated payments of over $10,000 on occasion for people to surrender their homes.
Many homeowners that choose to file Chapter 7 discover that although they may ultimately lose their home, they are still able to stay in their homes for several years without having to make any payments. Depending on the county in New Jersey the final sheriff sale can be pushed out. For instance, in Bergen County, there are sheriff sales scheduled over 10 months out from the time their final judgment was signed.
Even after a sheriff sale when the bank retains the property as no one buys it at the sheriff sale. Then the property becomes bank owned REO property and will eventually sell to a buyer. This process can take a long time, and even when there is a new owner, that owner will be required to either negotiate with the former owner to leave on a schedule, possible pay the former owner to leave, or file for eviction at which point the former owners can then defend themselves in court which can stretch out the time that it takes for them to leave their home. In some case the former owners become the new tenants for the home they used to own.
However, if the same people homeowner file for a Chapter 13 bankruptcy instead of a Chapter 7 they would also be able to stop the bankruptcy and try to work out a payment plan with the bank. Even if the bank had turned down the homeowner in the past for a modification, there is a possibility of being able to approach loss mitigation with the bank and come out with a modified load and have no need to complete the bankruptcy.
In other cases, even if loss mitigation is approved, it may be beneficial for the person to stay in bankruptcy and have their unsecured debts. Discharged at the end of bankruptcy if they have little to no equity in their home. This is why it is beneficial to speak to an attorney who understands bankruptcy law, and foreclosure defense law and how they interact together.
In other situations, it may be best for a homeowner to defend himself in court to prolong the time it will take to foreclose on the home. If a home owner is facing foreclosure and chooses to do nothing they can be facing a sheriff sale in about 180 days if the foreclosing attorney does everything they are supposed to do in a timely fashion. For instance if your bank hires a law firm like MCCABE, WEISBERG & CONWAY, P.C you could be facing foreclosure much faster than you would believe possible. When people ask us to foreclose on a property, we tell them to go with MCCABE, WEISBERG & CONWAY, P.C because we do not foreclose on people, and they are the best law firm we have witnessed at hitting all the time lines for a foreclosure with accurately prepared paperwork. Do not believe any one that tells you that all foreclosures take years to complete. This is not true.
If you are facing a tax lien foreclosure instead of a foreclosure on your mortgage the time to respond is even faster, and if you were served properly you can lose your home the day the judge signs the order in favor of the person with the tax lien certificate.