Foreclosure is often a symptom of greater financial problems. Before your situation deteriorates further, and before you take actions that may hurt you instead of help you, a person facing foreclosure should seek the advice of an experienced attorney to determine what the best options are and what mistakes to avoid. The bankruptcy code contains a trap for the unwary. No person is eligible to file bankruptcy unless that person has first attended a credit counseling session and obtained a certificate of completion within 180 days prior to the bankruptcy petition date. It may take 5 days or more to get such an appointment. If you procrastinate, you may not be able to use bankruptcy to stop your sale because you might not be able to get your counseling certificate in time. Do not delay - get your certificate at least 60 days prior to your scheduled foreclosure sale so you are eligible to file bankruptcy if you have to.
Taking a second mortgage on your house to cure the amount owed on the first mortgage
Second mortgages are expensive. Usually, there are points charged, fees, closing costs, and a higher interest rate. The equity in the house that existed before the second mortgage may be lost when a second mortgage is obtained. There may be better alternatives than a second mortgage for dealing with the foreclosure. An attorney at Vanden Bos & Chapman, LLP can explain those alternatives to you.
Some people feel so overwhelmed by foreclosure process that they give up and let the foreclosure run its course, thereby losing their house. Do not give up without being informed of your options. An attorney at Vanden Bos & Chapman, LLP can review a variety of alternative courses of action for a person facing foreclosure. Some of those may work for you. You owe it to yourself and your family to take any reasonable steps that may help you preserve the house and your equity in the house.
Setting the price of the home too high when selling it
If you are in foreclosure, you do not have much time. Sometimes the sale of your house is your best option for dealing with the foreclosure. The fact that you are in foreclosure usually depresses the price that you might otherwise receive for your house. An aggressive price needs to be picked considering the limited time available to sell. You should listen to a competent real estate agent and make sure that the agent understands the limited amount of time to sell the house so the house is priced and marketed aggressively.
Refusing to consider bankruptcy as an option to prevent loss of the house
Understandably, many people never contemplated the possibility of filing bankruptcy. Similarly, many people initially consider the prospect of filing bankruptcy to be distasteful. However, a Chapter 13 bankruptcy may be the best method for keeping your house and catching up on your payments or getting enough time to sell your house for its fair value. It is usually better to file a Chapter 13 sooner rather than later. An attorney at Vanden Bos & Chapman, LLP can fully explain how a Chapter 13 would work in your particular circumstances. Do not deprive yourself of access to information that may help you. You should call for an appointment as soon as possible. Our number is (503) 241-4869. Of course, having an appointment is confidential and does not obligate you to any particular course of action or to file a bankruptcy.
Failing to set aside money to catch up on past due house payments
Once a foreclosure starts, the lender typically will not accept your monthly house payments. As each month passes, the amount of the arrears gets larger and larger. Unfortunately, most people spend the money that they would otherwise send to the lender for the monthly house payment. It is better to set aside that money in a separate bank account as a reserve so you can use it later in a Chapter 13 process to get caught up on the house payments.
The simple fact is that most persons facing foreclosure have never been in foreclosure before and never dreamed that they would be in foreclosure. It is often difficult to admit to yourself the seriousness of the problem. Instead of taking action to deal with the problem, people often delay until it is too late and options are lost. Do not rationalize that a foreclosure is not serious or that you will be able to make it go away. You need to see an attorney as soon as you know that you might be foreclosed to make the appropriate plans to deal with it.