The thought of foreclosure is an understandably terrifying idea to many homeowners and families yet unexpected financial struggles are real. This blog recently discussed who may be able to receive Chapter 13 bankruptcy protection and it is important for struggling homeowners to know that Chapter 13 bankruptcy resources may be able to help them with foreclosure concerns.
Chapter 13 bankruptcy protection is a bankruptcy protection option that allows the filing party to reorganize their debts and repay them over a more manageable three to five-year period. This option is for filing parties that have a reliable source of income to repay their debts but have fallen behind for one reason or another. Other bankruptcy options, such as Chapter 7 bankruptcy, are also available and may provide some help protecting a family home through a homestead exemption.
While bankruptcy protection is an important remedy for struggling homeowners and others, it can quickly grow complex so trained guidance through the process can be helpful to achieve the best outcome possible. As part of a Chapter 13 bankruptcy, the filing party may have time to stop creditor collection actions and get current on their mortgage or other payments. This may allow them to save a family home. As is true of any type of bankruptcy protection, once the filing party has filed for protection, all creditor collection actions must cease during the bankruptcy process.
There are a variety of important legal tools available to help struggling homeowners navigate through the challenges they face to protect what is important to them and help them enjoy debt relief and avoid foreclosure. It is important that they understand these options, and the different options available to them, so they can find the best option that works for them and protects their interests and what is important to them.