Foreclosure is one of the most traumatic financial situations a person may face. And unfortunately, it is very common. If you are facing foreclosure, you may feel powerless and confused. But you can stop it if you take action. You can seek debt relief, work a deal with your mortgage company, or file for Chapter 7 Bankruptcy. Depending upon your particular situation, a knowledgeable Arkansas Bankruptcy Lawyer can walk you through your options and help you decide on the best way to save your home.
Here are some steps to take to stop foreclosure with Bankruptcy:
1. Get the Documents Ready
Gather all the documents dealing with your mortgage loan. You should also have ready all the legal documents and paperwork that you received regarding foreclosure action. These legal documents also need to be included as part of evidence for your Chapter 7 bankruptcy petition.
2. Gather your Current Statements
If you have any other accounts that you owe money on, then you need to get the current statements for each account. When you file for an Arkansas bankruptcy, all your debts are an issue. You cannot just file bankruptcy on your mortgage debt.
You also need to obtain all the current bank statements, especially from any of the other financial accounts that you have. You will also need copies of your most recent tax returns and paystubs. It’s not just about documenting your debt; you need to document your assets and earnings too.
3. Obtain and File the Petition
Once you gather all this information, you are ready to file for an Arkansas bankruptcy. Online forms are available, but naturally I suggest you hire a lawyer. Bankruptcy law can be confusing. If you are doing it yourself, after you fill out the form, then you need to file it with the United States Bankruptcy Clerk for either the Eastern or Western District of Arkansas, depending on where you live.
4. Send a Copy of the Stay to Your Lender
The Clerk will mail out your first round of notices. So, you need make sure all the addresses are included and correct in your petition. All of your creditors, co-owners, and co-debtors will receive notice of your bankruptcy.
5. Sign a Reaffirmation Agreement
It may be in your best interest to enter into a Reaffirmation Agreement with your mortgage lender. However, it may not. You may not be able to afford your house or you may be upside down on your property. If you do enter into a re-affirmation agreement, you can keep your home and get out of foreclosure. However, you’ll have to carry on making mortgage payments according to the terms you’ve agreed to in your re-affirmation agreement.
The most important thing you need to know about avoiding foreclosure is that you have to do something. You cannot ignore your mortgage company. Please contact us for more information about all your options to save your home, including Chapter 7 Bankruptcy.