Atlanta Bankruptcy Attorneys can Stop Foreclosures

Atlanta bankruptcy attorneys use federal bankruptcy law to help homeowners protect their houses from foreclosures. Federal bankruptcy law provides relief to homeowners through what is known as the “automatic stay.” The stay is basically a court order that says creditors cannot take any actions to collect money from debtors, including foreclosure. In Atlanta, this order will come from a judge in the Northern District of Georgia, Atlanta, Division.

When Do I Have to File Bankruptcy to Stop a Foreclosure in Atlanta?

In Atlanta, foreclosures are conducted on the first Tuesday of every month. You should receive notice of the scheduled foreclosure via certified mail. So long as you file bankruptcy BEFORE the foreclosure date (and it is your first or second bankruptcy filing), the automatic bankruptcy stay will protect your home from foreclosure. I typically like to file bankruptcies to stop foreclosures no later than the Friday before foreclosure day. That way, I am able to call the foreclosure attorney for the bank and notify the bank of the bankruptcy. However, filing your bankruptcy case as late as the Monday before foreclosure day is sufficient to stop the foreclosure.

How Long Will I be Able to Keep my House After Filing Bankruptcy to Stop a Foreclosure?

After you file bankruptcy and the foreclosure process is halted, you can keep your house long-term if you provided a way to catch up on past due payments in a Chapter 13. in a Chapter 13, you pay a bankruptcy trustee a monthly payment to catch up on past due payments AND you pay your regular monthly mortgage payment as it comes due. Or, if you filed a Chapter 7 knowing that you will ultimately allow the bank to foreclose on your home, you will likely have at least 3 months more in the house. In either type of bankruptcy case, the bank is required to file what is known as a Motion for Relief in order to initiate a foreclosure again. This process is where the bank asks the court to get rid of the stay order so that the mortgage company can foreclose when payment is in default.

How do I Know if a Chapter 7 or a Chapter 13 is Better for Saving my Home?

Often, homeowners are very attached to their homes and do not want to lose them. However, if your mortgage payment is more than 1/3 of your household income and you are significantly behind on your mortgage payments, I would caution you from trying to enter into a long-term plan to keep the home. That’s because you would have a difficult time budgeting in the mortgage-related payments, as indicated by the fact you fell behind on payments in the first place. In this case, I would recommend a Chapter 7 to temporarily stop a foreclosure and allow you some time to decide what to do and find a new place to live. Further, upon the close of the bankruptcy case, you would receive a dicharge or wipe out all of the mortgage debt.

However, if you fell behind on mortgage payments due to a short-term illness or job loss and are currently earning sufficient income to repay the past due mortgage and continue paying the monthly payments as they come due, a Chapter 13 may be the right bankruptcy to file to create a long-term plan to keep your home in Atlanta.

If you wish to speak to an Atlanta bankruptcy attorney about how to stop a foreclosure, please call us at 404.585.0040 for a free consultation.