As a Sacramento bankruptcy attorney, I'm in a good position to see and correct common misconceptions related to home foreclosure. One of the most common misconceptions out there is that bankruptcy will prevent a foreclosure from going forward.
Chapter 7 bankruptcy will not (by itself) prevent a foreclosure from happening. Ultimately, if you're going to stay in your home you'll have to continue to make your monthly mortgage payments, regardless of your decision to file for bankruptcy.
Filing for bankruptcy protection does offer the benefit of the automatic stay, however. The automatic stay is essentially a time-out period, putting a stop to all collection efforts and other harassment from your creditors once your case is filed. This includes a foreclosure proceeding. Keep in mind, however, that the automatic stay is just a temporary time-out. That is, the foreclosure will just be put on hold while your case works its way through the bankruptcy court.
Chapter 13, a topic for another day, does provide homeowners with more options in terms of being able to keep their home.
Remember, even if you file for bankruptcy you'll have to continue to make your monthly mortgage payments before, during, and after your case is resolved.
I am a Sacramento bankruptcy attorney and I offer free consultations for people considering bankruptcy or facing foreclosure. Our Sacramento office is located at 1104 Corporate Way, Sacramento, California, 95831. We also have offices in Oakland, Fairfield, and Walnut Creek. Please call us at 925-932-7086 if you'd like to schedule an appointment.
