Foreclosure vs. bankruptcy and your credit | Mortgage, Home Loan ...

Articles by Linda Adams

The Queen?s own credit

I was recently by someone who contacted his house lost to foreclosure. It seems that the bank does not communicate very receptive to his efforts with them and work on something. The circumstances of his late payment had changed and they now had the ability to pay and wanted to know how to save themselves from foreclosure. She had tried for four months, information and assistance from its lenders, but in vain. She is now in a position where it is considering bankruptcy to save himself from imminent foreclosure. Foreclosure starts in most states, if you?re behind in your payments for several months. If you can not catch up or work on something in the time set by the lender, usually three months, you will be informed that your house will be sold at public auction. Some states allow a redemption period, the period after the auction, in which you can redeem the amount due on your home and recover.

If you are on the verge of foreclosure, you can already think of bankruptcy. This may or may not help, your house, but at least it will give you more time to figure out what to do next, that bankruptcy will stop the foreclosure process for some time. The two most common two types of bankruptcy, you can file:

Chapter 7 bankruptcy will not prevent the foreclosure, but it can do it for an hour late. If you use this time wisely, you can save money will help you and find a place to live. Chapter 7 bankruptcy, which erases all your unsecured debt and mortgage debt and with the new law, you may be exempt from tax for the loss suffered by the lender in foreclosure.

Chapter 13 bankruptcy is

in which you define a plan to repay your debts over a period of time. This allows you to defeat the foreclosure ? as long as you keep the payments

Since I am not a lawyer or accountant, I am you can not guess at what this may be better for you .. But I want to emphasize that if you go into foreclosure, it could take at least 36 months until you can get another mortgage. Going into Chapter 7 bankruptcy may allow you to further mortgage in about 18 to 24 months. This is more lenient, because you can not bankrupt again in 8 years.

Linda Adams is an innovative and experienced mediator and educator with over 20 years experience in designing and implementing programs for audiences of all ages. It is to help others understand the importance of credit in all facets of their lives dedicated. Find more articles Linda Adams, The Queen?s own credit Copyright 2009 LDRA Performance Consultants Inc. All rights reserved.

Source: http://www.port41.com/foreclosure-vs-bankruptcy-and-your-credit.html

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