When to Stop Foreclosure with Bankruptcy Using Chapter 7

News today is a little confusing. We hear the U.S. recession over and the country is rebounding. The Dow-Jones Industrial stock index seems to confirm these claims. Yet, jobs still disappear offshore at an alarming rate and small businesses struggle. For over 90% of the U.S. population, costs rise and income declines. Job security remains at an all time low for the last 80 years, and according to Bloomberg News, the national foreclosure rate remains at the highest level in three decades. Despite all negative news, you have options.

If you are wondering, can bankruptcy stop foreclosure, you must know the requirements to invoke the stay and later satisfy your creditors. For instance, in Chapter 7, homeowners must bring all payments current. Otherwise, mortgage companies are entitled to lift the automatic stay. For most people, this requires a steady job to keep payments current.

The Chapter 7 process lasts about four or five months. When you file, all creditors included in the case are prohibited to collect debts. All foreclosure proceedings must stop. Then, if payments remain past due or slip past due, foreclosure, repossession and laws suits may resume with court approval. This later approval is almost as automatic as the inception of the stay. Keep your payments current and in four months, you could be debt free, keep your home, and retain all exempt property.

The most successful way to stop foreclosure is to compare all available options before you take action. You have a stunning array of alternatives provided by law and workout lenders. Compare your options down to the last penny, side by side, and evaluate the impact each has on your lifestyle. The comparison process is simpler than most people realize.

Choosing your best strategy begins by identifying your options. Consider credit counseling to get started and perhaps a debt management plan. For stronger and quicker relief, debt settlement plans offer far greater debt reductions. Frequently, debt settlements reduce monthly payments by half. Also consider bankruptcy through both Chapter 7 and Chapter 13. Carefully evaluate each strategy and your expected savings using all of these alternatives. Estimate the impact on your credit rating.

Your credit rating drops each time your payments are late. Your rating improves with each timely payment made. Even bankruptcy can improve your rating, because filing should stop all late payments and begin your steady climb higher.

Look hard at all options, and then decide. Chapter 7 discharge is the full-strength option. It wipes out potentially all claims and eliminates all payments, except the particular property and debts you choose to retain.

Dave Clark is an attorney who writes frequently about U.S. bankruptcy strategies . His clients asked, can bankruptcy stop foreclosure with guaranteed results? Yes, certainly, and his articles explain how you too can achieve extraordinary success.