Article By: Georgette Miller, Attorney at Law
Falling behind on a mortgage can happen to anyone whether it is due to a job loss, unexpected illness or simply losing control of your finances. Foreclosure may be on the horizon and you know there is little chance you can bring the payments up-to-date. It is important to know that hope is not gone, there are many different strategies to stop foreclosure.
File for Bankruptcy
One way to stop foreclosure proceedings is to file for bankruptcy. The automatic stay provided with bankruptcy will stop the foreclosure immediately. The stay prohibits your mortgage company from foreclosing on your home as a foreclosure is an attempt to collect a debt. Under bankruptcy laws, all attempts to collect debts must be halted once bankruptcy is filed. The mortgage company may file a motion to lift the stay. Even if it is granted, it will delay foreclosure for a few months, giving you time to seek other options to avoid losing your home. If foreclosure is just a few days away, however, bankruptcy will not stop it as it takes time for a bankruptcy to be filed in the court system.
It is best to seek a loan modification before your home is close to foreclosure, but one of the strategies to stop foreclosure is to apply for a modification since lenders are restricted from what is called “dual tracking.” Dual tracking occurs when a lender proceeds with foreclosure when a loss mitigation application is pending. A loss mitigation is a process where lenders work with borrowers to resolve past-due mortgage payments. New federal laws now ban dual tracking.
File a Lawsuit
Lenders do not always follow the law when it comes to foreclosure proceedings. Most states require that foreclosures be processed through the court system. If a lender is attempting to foreclose without going through the courts, a lawsuit may delay or stop the process completely. You may also be able to file a lawsuit if your lender cannot provide you with proof they hold a promissory note on your loan or did not act in compliance with state mediation laws. It is possible that the mortgage holder does not have a promissory note or may not hold all the documents necessary to prove that you must repay the mortgage to them if you have had more than one mortgage company. Often, companies sell mortgages to each other and it is possible that not all the paperwork necessary was transferred properly.
If you are facing foreclosure on your home, you need to know the strategies to stop foreclosure. Contact the Law Offices of Georgette Miller and Associates to learn what rights you may have and how you can stop foreclosure in order to keep your home. You can reach us by phone at 1-866-96-GMLAW or fill out our contact form.