Will filing for Chapter 7 Bankruptcy stop foreclosure?

Filing for Chapter 7 Bankruptcy in Tennessee can help stop foreclosure of your home. If you file for bankruptcy before the foreclosure sale date, the bankruptcy court will order an "automatic stay" that prohibits your mortgage lender from continuing or starting the foreclosure process. This stay will remain in place until the bankruptcy is finalized or until the court lifts it. In addition, filing for Chapter 7 bankruptcy can help protect your other assets, such as cars and furniture, from being seized and liquidated in the foreclosure process. Once the bankruptcy is filed, all creditors are notified and are legally required to stop all collection efforts. However, while filing for Chapter 7 bankruptcy can help you avoid foreclosure, it doesn’t automatically stop the foreclosure. The bankruptcy court may require you to enter into a payment plan to catch up on your past due mortgage payments. If you can’t or don’t enter into such a plan, then your lender can resume the foreclosure process. Additionally, if your lender manages to sell your home before the bankruptcy is finalized, you may still be liable for any remaining mortgage balance. Overall, filing for Chapter 7 bankruptcy can help stop foreclosure in Tennessee and protect your other assets. However, it’s important to understand the limits of bankruptcy and the potential risks before deciding to file.

Related FAQs

Will filing for Chapter 7 Bankruptcy stop foreclosure?

Related FAQs

Related Blog Posts