Do you need a trusted advisor to guide you through this challenging time? If so, a foreclosure lawyer may be able to help. But, how can a lawyer stop foreclosure?
Well, attorneys have many methods that can stop foreclosure. This article explains how they can accomplish this task while building trust and support.
You do not want to wait until the foreclosure phases advance too far and limit your options. Reading this guide will help you understand your legal rights and develop a strategy to protect your future.
Understanding the Foreclosure Process
Foreclosure starts when a borrower falls behind on their mortgage payments. In response, the lender will issue a notice of default. This notification warns that you must catch up or face legal action.
The pre-foreclosure process begins if you cannot afford to pay the arrears. This phase involves filing a notice of sale with the county recorder’s office and publishing it in a local newspaper. At this point, you have limited time to work out a deal.
If you do not reach an agreement or pay what you owe, your property will go to the highest bidder at auction. If the property does not sell, the lender may take possession and sell it through a real estate agent.
The timelines for each step differs based on state law and the specific circumstances. Generally, foreclosure can take a few months to over a year. During this time, the borrower may have the opportunity to negotiate, file for bankruptcy, or seek legal help.
The consequences of foreclosure can be severe and long-lasting. In addition to losing the property, your credit score will suffer significantly. This event can remain on your report for up to seven years, which makes several tasks challenging. You may have trouble getting credit cards, car loans, or even an apartment.
Moreover, you can remain liable for any deficiency balance. The requirement to pay the difference between the amount owed and the sale can be a heavy burden.
Legal Options to Stop Foreclosure
Now that you know what you are up against, you can appreciate what an attorney can do for you. One or more of the following solutions can stop foreclosure in its tracks.
File for Bankruptcy
Bankruptcy exists to protect individuals who are struggling with overwhelming debt. Here are some ways it can help when you cannot pay your mortgage:
- The court system orders an automatic stay upon filing for bankruptcy. This legal action should stop all collection actions, including foreclosure. Consequently, you have more time to explore alternatives.
- One of the benefits of Chapter 13 bankruptcy is the creation of a repayment plan. This arrangement gives you three to five years to catch up on accounts in arrears. As long as you can make the payments, the lender cannot foreclose.
- Chapter 7 bankruptcy can also help stop foreclosure, but only temporarily. This debt relief uses liquidation to pay off debts. However, it can buy time to negotiate or secure other options.
Bankruptcy is not a cure-all for foreclosure and should only be a last resort. A local attorney can advise you on the best course of action. After all, you do not want to take this step without understanding the benefits and drawbacks.
Challenge the Foreclosure in Court
Challenging foreclosure in court can be an effective way to stop it from happening. In particular, it allows you to contest it and assert your rights. Here are a few of the legal mechanisms that can make this effort successful:
- Procedural errors: There could have been errors in the notice of default, notice of sale, or other aspects. Demonstrating that mistakes happened can delay or stop foreclosure.
- Lack of standing: There are situations where the lender cannot produce the original mortgage note. Alternatively, they could have transferred the mortgage to another party inappropriately.
- Defenses to foreclosure: There are many legal defense strategies, such as proving fraud or breach of contract.
Naturally, using this tactic requires hiring a foreclosure defense attorney. They must develop a comprehensive strategy based on the details you share. Regardless of how they approach the situation, hiring legal representation increases your chances of a positive outcome.
Apply for a Loan Modification
Applying for a modification allows you to renegotiate your mortgage and make payments more affordable. Here are some specific benefits to consider:
- You can reduce the monthly payments to a manageable level and remain in your home.
- You may get the bank to agree to catch-up payments that spread the amount owed over an extended period.
- Financial institutions may agree to augment the loan term. Generally, the result of this agreement is a lower monthly obligation and making payments beyond the original timeline.
Your lender may require extensive documentation and financial information before approving a modification. It is vital to your interests to apply as early as possible. Otherwise, the foreclosure process may have advanced too far.
A short sale allows you to sell the property for less than the amount owed. Then, the proceeds go toward paying as much as possible.
While you will not have your home anymore, you can avoid other devastating consequences. Your credit score will not suffer the same level of downgrading, which can help you maintain access to loans or other financial services. The lender may even agree to waive the deficiency balance.
A short sale can be a faster process than foreclosure. Generally, it takes less time to sell property than it does to go through the court system. As a result, you can resolve your financial difficulties and get beyond this period of your life.
Nonetheless, accepting a short sale may not be in your best interests. This reality makes it advisable to work with a foreclosure defense attorney. They have the knowledge and negotiation skills to ensure the final solution benefits both parties.
The Role of a Lawyer in Stopping Foreclosures
A lawyer can play a crucial role in preventing your foreclosure. Here are some of the tangible ways they can act on your behalf:
- Legal Defense: They can challenge the foreclosure process or defend against default claims.
- Negotiation: Many foreclosures can end by finding a mutually agreeable solution.
- Representation in Court: A lawyer can advocate for you by presenting compelling evidence and arguments.
- Assistance with Paperwork and Documentation: Foreclosure defense strategies involve significant paperwork and documentation. There are many legal filings, financial records, and loan documents to complete. A lawyer can navigate this process and guarantee everything is correct and on time.
- Referrals to Other Professionals: A lawyer has connections who can give more help, such as financial advisors or housing counselors.
- Guidance on State and Federal Laws: A lawyer can supply perspective, helping the borrower understand their legal rights.
- Advice on Bankruptcy: A lawyer can advise the borrower on whether bankruptcy is possible.
Schedule a Consultation With a Foreclosure Attorney
A foreclosure lawyer can provide the legal expertise and advocacy you need to stop foreclosure. Accordingly, we commit ourselves to helping you find qualified and experienced legal counsel. This is something that you can expect when you talk to us about foreclosure.
We work with a network of firms that specialize in this area of law that provide the assistance you need during. So don’t wait – complete our form or call (866) 345-6784 today to get connected with a local foreclosure attorney.