Personal bankruptcy options can help with the many concerns those facing overwhelming debt face. Those with overwhelming debt are also likely facing a significant amount of stress related to their debts, especially if they are facing the foreclosure process and the prospect of losing their family home.
Different personal bankruptcy options are available to help struggling consumers and homeowners in their individual circumstances, based on the needs they may have for the process. Chapter 13 bankruptcy, for example, is an option that may be able to help with the foreclosure process. Chapter 13 bankruptcy may be able to help homeowners who are facing the foreclosure process .
To begin with, the automatic stay that goes into effect whenever a filing party files for any type of personal bankruptcy protection prevents creditor collection actions. The automatic stay prevents creditor collection actions from progressing and also new creditor collection actions from beginning during the bankruptcy process. The automatic stay can prevent foreclosure until the filing party’s repayment plan under Chapter 13 bankruptcy is worked out. Once the repayment plan is confirmed, the filing party can repay missed payments over the 3 to 5 years allotted for the repayment plan and may be able to save their home as a result.
Chapter 13 bankruptcy can permanently stop foreclosure in some instances but may not be able to stop it in others. As a result, parties seeking to avoid foreclosure and the loss of a family home should be familiar with the different legal options available to help them, including chapter 13 personal bankruptcy protections, how they work and when they can help.