Since a majority of the population purchases the property by taking a loan, non-payment of dues may result in you losing control over any such property. Some financial decisions may cause people to fall into a bad economic situation, which may cause you to fall behind on loan payments. Unless you make a decision soon, you might forfeit your property too. For timely intervention and proper guidance, search for bankruptcy lawyers near me and make a consult sooner than later.
Is bankruptcy the answer to your problem?
According to Los Angeles based law firm Recovery Law Group, bankruptcy is one of the best ways to prevent any foreclosing on your property. Through chapter 13, not only can you nip the foreclosure procedure in the bud, but also catch up on previously do payments, that too interest-free, over a 3-5 year repayment plan. A temporary financial setback can cause people to fall behind on a couple of payments. This should not be the reason for them to lose their prized possession. Consulting with Bankruptcy Attorney Los Angeles could provide you with the various options available to you.
Special considerations during financial distress
Based on your current financial situation, a repayment plan can be arranged by the bankruptcy attorney and the lender. This can result in a temporary suspension of payments. This can be possible if there has been a sudden slump in your earnings or any reasonable increase in your expenditure. However, it is important that you provide information to the lender about your desire to fulfil the new repayment plan devised.
Refinancing Mortgage Payments
You might also get the option of refinancing your debt as well as extend the term of your loan. In this method, the monthly payments are reduced, so that they do not cause unnecessary burden during an already difficult financial situation. You can qualify for it if you have recovered from any financial issues and can manage to make the new payment amount.
Sell off assets before foreclosure
Though selling off assets while considering bankruptcy is strictly prohibited, pre-foreclosure sale can help you avoid foreclosure on the property by selling it off for an amount which is less than that required for paying off the mortgage loan. This is possible only when the lender agrees that this will result in a quick sale of the property, meeting the guidelines set by the lender.
This is invariable, the last resort, where you voluntarily give the property back to the lender. Though you won’t be able to save your house, none the less you will be able to save your credit rating, which is much affected with foreclosure. The lender might accept a deed-in-lieu of foreclosure, if you have defaulted on payments and do not qualify for any other previously mentioned option.