Yes, bankruptcy will stop a New Jersey Sheriff Sale in most instances.
It doesn’t matter if a chapter 7 bankruptcy is filed or a chapter 13 bankruptcy is filled. What matters is that the automatic stay applies to the bankruptcy that was filed and that the sheriff was given the number prior to the auction. If you do not tell the sheriff about the bankruptcy, they will go forward with the sale, however, you may be able to have the sale vacated. Talk to an attorney if you find your self in this situation as if you go forward the wrong way the sale will not be vacated.
Even after A New Jersey Sheriff Sale there may be a “last chance” to save your home.
Even after a sheriff sale in you are allowed 10 days to pay off your home through the sheriff, This is called redeeming the property. If you file a chapter 13 bankruptcy you can extend the redemption period to 60 days. However, if you cannot redeem your property from the sheriff the next step by the purchaser at auction or the bank will be to evict you. If you are renting a foreclosed property that is sold at a sheriff sale you have additional rights than a homeowner.
By right, as a Borrower, you get postpone your NJ Sheriff Sale 56 Days
New Jersey Sheriffs have the discretion to grant 60 days as adjournments. Technically you can get two 30-day adjournments, how ever in practice sheriffs grant 28 days as the sheriff auctions are held on the same days of the week for 56 days total. Most times people ask for both at the same time. If you have exhausted your two adjournments, and need more time, there are two alternatives, but neither is guaranteed to be granted.
- You can ask your lender to adjourn the sale. In certain cases, such as if a sale of the property is pending or if a loan modification is likely to be granted your bank may actually give you the time.
- You can apply to the court for an adjournment or a stay of the sale. Once again there usually has to be a reason for the court to allow this to happen. Even in the case of a short sale, your realtor may be able to go in front of the court to ask for more time for the sale to be completed.
The Automatic Stay in Bankruptcy can be Terminated.
The automatic stay is the thing that causes banks not to foreclose. The stay is what protects you in bankruptcy from your creditors going after your property. The stay is basically the legal reason creditors cannot collect. This stay is automatically applied when you first apply for bankruptcy. If your bankruptcy is dismissed and you want to reapply for bankruptcy and it is one year from the time you first filed, the automatic stay is only applied for 30 days, but a motion can be made to reapply the stay for the duration of the bankruptcy. And if more than one bankruptcy has been dismissed within one year, then the stay is not applied, and a motion will have to be made to the court to reapply the stay. The court will normally reapply the stay that if it finds that someone is not trying to abuse the bankruptcy system.
So, it is possible to file bankruptcy stop a sheriff sale have the bankruptcy dismissed and file bankruptcy again to stop the sheriff sale, and both times this would stop the sheriff sale, however filing a third time will not automatically stop the sheriff sale after 2 dismissals. And, the sheriff sale may go off if you are not careful.
Chapter 20 Bankruptcy to get rid of Unsecured Debt and then only pay Secured Debt
A chapter 20 bankruptcy is a term for when a person will file a chapter 7 bankruptcy to get rid of their unsecured debt like medical and credit card debt and then file a chapter 13 bankruptcy to only deal with secured debt like a house. In situations like this, you have to make sure you do not have too much equity in your property or a chapter 7 trustee may try to sell your home.
BY declaring a chapter 7 you can make it easier to qualify for a chapter 13 bankruptcy. Getting rid of old tax debts, credit card debt, judgments and other creditors may make it actually possible to qualify for a chapter 13 wherein certain circumstances you may have too much dept to qualify for a chapter 13 bankruptcy.
Loan Modification in Bankruptcy is Oversaw by New Jersey Bankruptcy court.
Even if you have been turned down for a loan modification, you can try again in bankruptcy. In bankruptcy, the court has a portal that the bank will be required to use to get documents from you, so the excuse that they didn’t receive the document will not fly. Loan modifications are not required to be given by banks, however, the bankruptcy process may make getting one done easier with the banks who do offer loan modifications.
Veer Patel, Esq. NJ Foreclosure Defense lawyer is both a New Jersey & New York State Licensed attorney He focuses on saving homes from Foreclosure. He has helped many people with defending foreclosure lawsuits in both New Jersey and New York. If you would like to contact him, call 973-200-1111 or email [email protected]