Bankruptcy and foreclosure

Cash-strapped homeowners in Minnesota may have deep concerns about the possibility of foreclosure. This is particularly true in situations where unemployment is a factor and making mortgage payments becomes increasingly difficult. In such instances, they may wonder about whether any options exist for saving their home in the face of financial challenges.

While Minnesota was not included in a recent list of the 10 states with the highest foreclosure rates in May 2015, the threat of foreclosure remains. While one missed mortgage payment generally does not result in foreclosure, the reality is that it can be very difficult to catch up on financial obligations. As a result, foreclosure can become a real risk.

There are several ways to address the threat. One way is through bankruptcy. In some cases, it may be possible for someone to either delay or avoid foreclosure by declaring either Chapter 7 or Chapter 13 bankruptcy. In some cases, the automatic stay on collection activities can at least temporarily halt wage garnishments and bank account levies, freeing up cash so that the homeowner can make mortgage payments. The automatic stay provided by bankruptcy can also give homeowners in foreclosure some additional time to find new housing, even if the lender is eventually able to lift the stay and continue with the foreclosure process.

Homeowners may find it helpful to speak with an experienced bankruptcy attorney who may be able to review their case and offer advice. The attorney may be able to assess whether bankruptcy is a good option for dealing with foreclosure, as well as determining whether the client meets the eligibility requirements for bankruptcy protection.

No Comments

Leave a comment
Comment Information

Prescott Pearson & Tande, PA
443 Old Highway 8 Northwest, Suite 208
New Brighton, MN 55112

Toll Free: 888-366-0827
Phone: 651-968-8096
Fax: 651-633-7562
New Brighton Law Office Map