If you are concerned about the possibility of losing your home because the payments are becoming unmanageable, there are steps that you can take to avoid foreclosure. It is wise to contact your mortgage lender proactively if you come to the realization that you are not going to be able to meet your upcoming obligations. The lender may be able to work with you and make some adjustments so that you can get back on track.
For example, let’s say that you cannot make your payment, but you will be receiving an inheritance in a couple of months after your father’s estate has been probated. Your mortgage holder may be willing to allow you to pay what you can afford for a limited period of time until you receive the bequest. Under different circumstances, you may be able to work out a long-term loan modification. A conversion from a debilitating adjustable rate mortgage to a fixed rate loan could also be a possibility.
The Bankruptcy Solution
Negotiating with your mortgage lender will sometimes be possible, but a bankruptcy filing will be the best choice for many consumers. If you are current on your mortgage payments, but unsecured debts like medical bills and credit card balances are making it hard for you to fulfill all your responsibilities, you may want to file a Chapter 7 bankruptcy. You could maintain ownership of your home, but unsecured debts would be discharged. You would then have more disposable income to pay priority debts like your mortgage.
If you are behind on your mortgage payments, you could choose to file for a Chapter 13 bankruptcy. This is a reorganization bankruptcy. With this type of bankruptcy, your debt is restructured, and you make affordable payments over a 3 to 5-year period. Your mortgage arrearage could be paid back over time as part of the reorganization arrangement, and you would be able to maintain ownership your home as long as you keep the ongoing monthly payments current.
Now that you have digested this information, you may be ready to take direct action. Our firm offers free consultations to people in Salem, Grants Pass, Klamath Falls, Tigard, Roseburg, and several other cities in Oregon and Washington. If you would like to set up an appointment, send us a message through the contact page on this website or call us at toll-free at 1-800-682-9568.