Foreclosure is a bitter subject for Georgia residents, and understandably so with thousands of foreclosures every month. By some estimates, 1 in 250 homes is lost to foreclosure in Georgia every month. We go over this quite often on Georgia Debt Law. In a blog post in March of 2010, we asked some important questions. “Can you buy yourself time to get new shelter, save the home, or negotiate on the mortgage? By filing bankruptcy in Georgia, you can not only buy yourself time, but negotiate to save your home from foreclosure.”
Those are strong statements, and they still apply to all of us. Bankruptcy can help you avoid losing your home to foreclosure. Bankruptcy can also buy you time to find a new residence if indeed you are too late. Sometimes you might be able to negotiate on the mortgage, lowering payments. You always have rights, and bankruptcy is one of them. If you are unsure of how to get going, this guide can help.
Why not Chapter 7?
Chapter 7 bankruptcy liquidates your assets, and that means you stand to discharge debt but lose assets and properties, including your home, if you file. However, you have the option of negotiating outside the bankruptcy to save your Georgia home.
Why Chapter 13?
Chapter 13 bankruptcy is a debt repayment plan, and you have much more protection for your home here than with Chapter 7. Georgia home owners who do not want to lose their residence are taking advantage of the time gained with Chapter 13. You get 3-5 years to catch up on bills. If you plan this right, you can be back on track with your mortgage, not to mention your other debts, in a fair amount of time. It’s not a race like Chapter 7, which only lasts 3-4 months typically, but it can protect your home and other assets.
What if it’s too late?
If you are too late to the party – if the foreclosure process has started — you still have some options. You may prefer to file Chapter 7 so you can discharge the debt. Therefore, you lose the money owed on the mortgage. This next part is important: you typically get several months rent free in your home to find a new residence, so start preparing for a move. Why does this occur? It’s the automatic stay. Once you file bankruptcy, all collections against you must stop, typically for several months.
What if you don’t want the home?
If you don’t want the home, you may sell it in a short sale. You might even get lucky and sell via regular means and get full value. And again, Chapter 7 is an option if you simply cannot afford it.
Who can help?
Bankruptcy does not solve all your problems. You still have to rebuild credit and pay bills. However, you can get a fresh start by filing. If you want to protect your Georgia home, consult with some legal professionals. You should consider hiring an experienced Georgia bankruptcy attorney to get started. When you hire a lawyer, pay for value, pay for experience, and pay for results.
