More tips to help stop a late-state foreclosure

Have you fallen behind on your mortgage payments and need to know how to stop foreclosure at the last minute?

You might feel hopeless or powerless due to the potential of losing your house. However, you might be able to save your house by using one of these 4 strategies to stop foreclosure at the last minute.

1. File for bankruptcy.

The first step to stop foreclosure at the last minute involves filing for bankruptcy. When you file, the court issues an order containing an “automatic stay,” putting a foreclosure on hold. While the lender can get around an automatic stay by filing a motion, even if their motion is granted, it will take a while to take effect. If the lender does not make a motion to remove the stay, the hold will last throughout the remainder of the foreclosure process, which can last up to 4 months.

What are the risks of bankruptcy?

• The inability to file another bankruptcy for a certain period of time, and you can lose your protection against new collection actions (such as wage garnishments).
• Your credit takes a hard hit, and even if you can get credit, it comes with significant interest rates.

Chapter 13 bankruptcy may allow you to save your home if you are ALREADY in the bankruptcy process.

Chapter 7 may help you if you can no longer make payments.

2. Apply for a loan modification.

It is easier to apply for a loan modification before you are facing the daunting task of how to avoid foreclosure, but it is still possible to do this at the last minute. If the modification is approved, your foreclosure remains stopped unless you stop making payments again.

3. Sue your lender.

If your lender is using a nonjudicial process to foreclose outside of court, then you can actually file a lawsuit against the lender. This is risky for several reasons. First of all, it can be very costly. Second of all, since you are the plaintiff challenging the foreclosure, you will have the burden of proof (meaning that it’s on you to provide evidence that you are not at fault).

(From nolo.com): To prevail in your lawsuit against your lender, you will need to prove to the satisfaction of the court that the foreclosure should not take place because, for example, the foreclosing lender:

• Cannot prove it owns the promissory note
• Did not act in compliance with state mediation requirements
• Violated the state’s Homeowner Bill of Rights
• Did not follow all of the required steps in the foreclosure process (as determined by state law), or
• Made some other grievous error

4. Contact us for more tips on how to stop foreclosure at the last minute

If you live in the city of Plano, we have connections with the city that allow us to know how to stop foreclosure at the last minute in certain situations. This is at no cost to home sellers.

If you are facing foreclosure and considering your options, call us to get your questions answered.

Contact us for a free, no-risk quote within 24 hours.

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