Having your home foreclosed on can be difficult and scary. Any financial catastrophe often leaves the person feeling humiliated and overwhelmed. Those emotional components can sometimes make people hide from the issue rather than acting early on.
If you’re currently in danger of foreclosure, the first thing you want to do is research all the information you can. Acting now could help you get out of the situation before it’s too late to stop foreclosure.
It’s better to know your financial picture and what your options are than to wait for a foreclosure to set in. Realize, too, that anyone can run into bad luck or find themselves in the same situation. Now it’s time to look at the concrete steps you need to take to move forward.
In most cases, filing for bankruptcy can stop a foreclosure providing that you’re still the property owner. However, this timeline varies by state. So, when is it too late to stop foreclosure?
State by State Information on When It’s too Late to Stop Foreclosure
Laws differ by state. It doesn’t help you to hear rumors or listen to people who have second or third-hand experiences with the process. First of all, they might have the facts wrong. Second, their lender may have a different set of rules than yours. It’s best to do your own research in the context of your unique situation.
In some states, there’s judiciary foreclosure; which means that the case needs to go before a judge before the property is officially no longer yours. Other states have nonjudicial laws, which can make the process go much faster for the lender.
Here are a few examples:
- Texas – Texas allows for nonjudicial foreclosure, which means that the lenders can foreclose fairly quickly, in some cases as little as 60 days. The lender sends a notice of default 20 days after the payment is past due.
- California – In California, you have the option of bringing the loan current. You have up until 5 days before the sale to pay all the back mortgage payments and any fees. Within the last 5 days, you still have the right to pay off the entire mortgage, but it’s up to the lender whether they will accept back payments to keep you current at that point.
- Arizona – The law here allows borrowers to pay the balance of their missed payments and any fees to get current up until the last business day before the sale.
It’s important that you look up the laws in your state so that you know exactly what your timeline is and how much money you’ll need in order to stop the process. If you don’t understand the information or need help, consult with a lawyer as soon as possible.
How to Stop Foreclosure
There are a few ways that you can stop or delay foreclosure proceedings. The best method will depend on what you’re trying to accomplish. For instance, if you want to keep the home and your credit intact, working with the lender may be the best way to go if possible.
Here are some options:
- Chapter 13 Bankruptcy – A Chapter 13 bankruptcy will allow you to restructure your debt and keep your home. Filing for bankruptcy will also halt the foreclosure proceedings.
- Chapter 7 Bankruptcy – Chapter 7 bankruptcy will also halt foreclosure proceedings but it’s really just a method to stall for time. You would choose this method if you’re not intending to keep the home but just need a few months of breathing room.
- Loan Modification – Working directly with the lender to modify the loan is a good option if you can afford to start making payments right away.
To view a more detailed list of options, take a look at this article.
The Best Way to Stop Foreclosure May Be to Sell the Property As- Is
If foreclosure is a growing concern, selling your home quickly can mean the difference between losing it to the bank and walking away on your own terms. At HomeGo, we purchase homes in pre-foreclosure and offer leaseback programs if you need extra time to move. Contact us today if you’re interested in selling your property before it’s too late to stop foreclosure.