Chicago Homeowners Can Stop Foreclosure With Bankruptcy
You might have fought hard to afford your mortgage payments - but most homeowners assume the battle is over when the foreclosure notice comes in the mail.
Not true, say Chicago bankruptcy attorneys. Sure, being this close to losing your house is not a good position to be in. But you do have one more shot to fix your financial situation and keep your home. Bankruptcy has the power to stop foreclosure while you and the court work out a payment plan with lenders. Many folks aren't aware that bankruptcy is an option - or they mistakenly worry it will wreck their credit. In reality, it can do just the opposite, according to MSNBC.com.
Going through foreclosure doesn't just mean surrendering your property. It also means damaging your credit. With bankruptcy, you show lenders that you're at least making an effort. If circumstances out of your control led to your delinquency - such as a divorce, medical emergency, or job loss - bankruptcy is meant to give you a way to get back on track.
Maybe that's why bankruptcy filings have continued to increase year after year since the recession began. As for the idea that bankruptcy will hurt your credit, here's the truth. Bankruptcy can pave the way for a fresh start so you can start rebuilding your credit. While it can be initially harder to qualify for a mortgage after bankruptcy, at least it's still possible. After you lose your home to foreclosure, you are ineligible for a home loan for seven years!
Look at it this way. The best case scenario is that you will avoid foreclosure and eliminate your non-mortgage debt so that your mortgage becomes more affordable. The worst case scenario is that you lose your home, but eliminate your debt so your other bills are more affordable - and so that you can more easily repair your finances and one day qualify for another loan. Either way, you still win.
Many of us avoid bankruptcy because we've heard so many myths about the process, it's hard to tell what's true. That's why it's important to educate yourself about your options. At DebtStoppers, you'll find the latest information about bankruptcy and how it can affect your finances. Try taking our Budget Challenge, or checking out the advice in our video learning center. And if you still have questions, consider trying a free personal debt analysis with a Chicago bankruptcy attorney. We can help determine whether a bankruptcy plan is right for you - so you can protect your house, and your future.