You want to prevent your home from appearing among the Dallas Texas foreclosure homes for sale list but you cannot raise the necessary funds to stop the mortgage company instigating the foreclosure process. Few things can be more stress-inducing than the thought of losing your home.
Thankfully, the US Congress foresaw this very event happening and passed bankruptcy laws that allow individuals to start with a clean slate. Congress has since continued to adopt new bankruptcy laws that protect creditors and debtors alike for current consumer challenges. By filing a petition for bankruptcy protection with the Northern District of Texas of the US Bankruptcy Court, you can immediately stop all collection attempts against you, therefore preventing a Dallas TX foreclosure. Depending on which type of bankruptcy you file and how much equity you have in your home, you should also be able to keep your home using bankruptcy.
Dallas TX Automatic Stay
The first objective that filing for bankruptcy achieves is to apply the automatic stay. The automatic stay places an immediate stop to all collection activities against you, including foreclosure. The Dallas TX automatic stay will remain in place until you receive your bankruptcy discharge or until a bankruptcy judge sustains a motion by a creditor to lift the automatic stay.
Keeping Property After Bankruptcy
What happens to your property after filing for bankruptcy in Texas depends on which form of bankruptcy that you file. When filing Chapter 7 bankruptcy, the automatic stay will stall your foreclosure sale for 3-4 months. As long as you have no equity in your home or can protect the equity you do have with the homestead exemption, you can keep your home using Chapter 7 bankruptcy. It is important to note that if you are behind on your payments, you will need to find a way to get caught up on your payments or negotiate a loan modification before your bankruptcy in order to prevent the foreclosure sale after your automatic stay is over.
Chapter 13 bankruptcy, alternatively, can help protect your home even if you cannot immediately pay off an arrearage. Chapter 13 bankruptcy in Dallas TX allows you to spread out the late payments over the entire life of your Chapter 13 repayment period which can be as long as five years. You will need to stay current on all payment during this repayment period in order to prevent foreclosure proceedings from being reinitiated.
Dallas TX Bankruptcy Attorney
While either type of bankruptcy, Chapter 7 or Chapter 13, can immediately stop a foreclosure sale of your home, one form of bankruptcy is typically superior to the other based on many variables. If you are behind on your home mortgage payments and wish to prevent a Dallas TX foreclosure with bankruptcy, always enlist the advice and assistance of a Dallas Bankruptcy Lawyer. An experienced bankruptcy attorney can help you make important decisions that will be in your best interest during your bankruptcy proceedings.