Stop Foreclosure

Stop ForeclosureYou can Stop Foreclosure by filing a Chapter 13 Bankruptcy. Chapter 13 is sometimes called the “Home Saver Plan.” Your Bankruptcy petition must be filed before the sale date of your property. We can do an emergency filing if your date is close. Call ASAP for a Free Phone Consultation with Michael D. Franco.

Chapter 13 Bankruptcy is one powerful way many Orange County home owners use to stop foreclosure of their home. Because of this, Chapter 13 bankruptcy is commonly called the “Home Saver Plan.” The Chapter 13 Bankruptcy petition would need to be filed before the sale date of your property to stop foreclosure. If you are facing an imminent foreclosure action, we can file an emergency petition – so call us at once! After filing, you will have to propose a plan to repay the amount you fell behind on the mortgage, but the arrears are often spread over 60-months. Even if you are ten thousand dollars in arrears, your monthly payment to catch up said arrears may be as small as $90 per month.


Orange County Stop Foreclosure Lawyer

Foreclosure Defense Attorney Helping Orange County Home Owners

If you have received word from your mortgage lender that you are facing foreclosure, there are steps you can take to stop the legal proceeding and stop foreclosure. Contact Michael D. Franco. Calling me should be your first action to take after receiving a foreclosure warning.

As the holder of a home mortgage, you have more rights than you might know. A mortgage is different from a secured car loan or RV loan. Losing your home to foreclosure is not the same as having GMAC send a repo man to take back your SUV if you miss a payment or two. State and federal law protects homeowners to a far greater extent. Banks and mortgage lenders are under specific regulations relating to the legal process required.

No matter how far along in the foreclosure process your mortgage lender has progressed, you can almost always STOP foreclosure sale by filing bankruptcy under Chapter 7 or Chapter 13 of the U.S. Bankruptcy Code. The very day you file, an “Automatic Stay” of execution is placed against all collections actions, pending the outcome of the court’s ruling in your case.

The Chapter 13 law is very powerful. We can use it to STOP your home foreclosure, allowing you to make up missed mortgage payments and keep your home. It can STOP repossession of secured property, such as a car, SUV, boat or RV and in most instances allows you to recover a vehicle that may have already been repossessed. Moreover, a Chapter 13 filing stops interest accruing on personal debt, including BACK TAXES (note: an exception to this are student loans). In exchange for stopping a foreclosure, a repossession, and ALL collections activity, you propose to pay all or, in some circumstances, a portion of your debt through a Chapter 13 repayment plan.

The Good News? The filing of a Chapter 13 Bankruptcy stops ALL collection activity though something called the “Automatic Stay.” The automatic stay starts the minute we file your Bankruptcy Petition and remains in effect during the life of your case unless the court deems otherwise.


Eliminate or Reorganize Your Debt — Keep Your House

A Chapter 13 is a reorganization of debt, allowing consumers (if “you” are a business a Chapter 11 bankruptcy will help reorganize your business debt) to repay all or a portion of your debt through a Chapter 13 repayment plan while protecting real and personal assets. The concept is like debt consolidation, but it permits you, the consumer(s), to pay unsecured debt down without accruing interest (student loans are an exception). Moreover, those annoying calls from debt collectors STOP immediately! Under a typical plan, you make monthly payments to a court appointed bankruptcy trustee from three to five years. The amount of your monthly payment is determined by several factors such as the amount of debt you have, your ability to repay. You pay the bankruptcy trustee and the bankruptcy trustee distributes the money to your creditors.

Michael D. Franco can assist you in designing a successful Chapter 13 repayment plan with the following:

  • Stable and regular income
  • Disposable income, from which to make monthly plan payments, determined from the excess moneys after paying “basic human needs”
  • Secured debt (i.e. home and car loans not exceeding $1,081,400)
  • Unsecured debt (i.e. credit card debt, medical and legal bills, student loans not exceeding $360,475)

A Chapter 13 bankruptcy repayment plan allows you to catch up on your missed car and house payments. Because one is making monthly payments, one can include entire car loan(s), or mortgage loan(s) into the Chapter 13 plan. While in bankruptcy, in addition to very small re-payment plan, one is responsible for making regular mortgage payments, regular car loan payments, and food, utilities and other normal expenses.

Taking advantage of the very forgiving Bankruptcy Process can be helpful for folks in financial distress, but the legal system is a maze of complex laws and regulations. Creditors have aggressive lawyers to fight you so why shouldn’t you have similarly aggressive lawyers to watch out for you? If you want to take full advantage of this very powerful legal process, then you need the best possible legal counsel you can afford. We would love to share with you our knowledge and experience, so you can make an informed choice.


What is a Foreclosure Action?

Essentially, foreclosure action is nothing more than a collection attempt by a mortgage company to force a homeowner to pay what they owe on their mortgage loan, or have their home auctioned off by the county government to satisfy the mortgage if there is no other way to collect the debt. There is nothing particularly exotic about the process, and it is little different from a credit card company or other “unsecured” creditor suing a borrower to force the payment of a debt. The main difference is that the mortgage debt is secured by the property (the home), so the bank or mortgage lender has the legal option to force the sale of the house.


Want to Keep Your Home? Then Fight Back!

The only powerful legal option that a homeowner has is to file bankruptcy to stop foreclosure. You can do so right up until just a few hours before the scheduled sheriff sale of the property. If you file a bankruptcy petition the morning of the proposed sale date, THIS WILL STOP the foreclosure process from being able to continue.

Of course, it is better to file before the very last minute, but sometimes homeowners are working on another solution that falls through or their bank’s Loan Modification Department has reassured the home owner that their loan modification is proceeding as planned, while another department of the same bank is proceeding to sell the property out from under the owner! It happens – unfortunately more often than you might suspect. If you find yourself in such a situation you will need to file an emergency bankruptcy.

Once a borrower files a petition with the bankruptcy courts, the “Automatic Stay” goes into effect, which precludes lenders from being able to continue collection efforts including a foreclosure sale. Because the foreclosure lawsuit is nothing more than a collection effort, the bank or mortgage company will have to put its foreclosure process on hold until the debt is resolved through bankruptcy, either through the payment plan or a dismissal. As you might conclude, lenders do not particularly want to deal with the extra hassle a bankruptcy causes, but they have no choice in the matter: you forced their hand and the must put the foreclosure on hold.


Is your Home’s Value LESS than the amount owed?

Finally, a word about underwater mortgages… If your home is “underwater,” and you have a 2nd or 3rd Trust Deed on the home, you may be able to “strip off” your second or third deed of trust with a bankruptcy if the value of your home has fallen below the amount owed on your first deed of trust. This can often erase $25,000, $50,000, even $100,000 of debt or more and will go a long way toward giving you that Fresh Start that you need to get your financial life back on track!

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