As prices in single family residences have continued to drop many have seen the equity in their homes disappear, and some have chosen to walk away from their homes instead of carrying a mortgage on a property that has been declining in value.
Walking away from one’s home is an emotionally draining experience, one that the majority of people in CA are feeling these days. However, allowing ones property to go to foreclosure is not the only way to ease the burden of a huge mortgage payment. At SM Law Group, our attorneys can help re-organize the arrears on a mortgage and allow the home owner up to 5 years to get caught up on their missed mortgage payments in a chapter 13 bankruptcy. In some circumstances we can even get rid of second and third mortgages on a home depending on the current value of the home and the 1st mortgage against it.
Bankruptcy can not only prevent a foreclosure and allow the homeowner to continue making payments on their terms; it can also delay the process for a significant amount of time (usually 4-6 months). Many homeowners have decided to walk away from their homes, with the filing of a chapter 7 or a chapter 13 bankruptcy prior to the foreclosure date we can buy the homeowner additional time to move out.
Also as a result of a bankruptcy filing (once discharged) the lenders on a property may not come after the homeowner for any deficiencies remaining after the foreclosure sale of the property.