Foreclosure can be a scary word for some people. If they are facing this possibility, they may be unsure of the future. The possibility of losing your home and not having anywhere to house your family is stressful. Shelter is a necessity and a home can become sentimental to families and all those living inside it. There are ways to defend yourself against foreclosure though. One way to stop the foreclosure of your home is by filing for bankruptcy. The two forms of bankruptcy for individuals can prevent foreclosure of your house. These are known as Chapter 7 bankruptcy and Chapter 13 bankruptcy. Through these two bankruptcy processes, an automatic stay goes into effect. Not only does this prevent creditors from reaching out, it also can prevent foreclosure.

What is a short sale?

A short sale is when a lender agrees to take a loan payoff that is less than the value of the mortgage. Although this can impact an individual’s credit, it may not cause as many negative effects as filing for bankruptcy or facing foreclosure. If debt concerning your estate has become overwhelming, this can be a good option to improve your situation. The pressure to pay your required costs may seem less overwhelming.

What is the process for a short sale like?

Before a short sale goes is guaranteed, it must be approved by the lender. Once it is approved by the lender, the seller cannot receive any of the proceeds. Instead, the closing costs are paid by the bank. If there is evidence showing that you can afford your mortgage, the lender has the right to deny your request for a short sale. During the process of a short sale, there are many factors that can impact the success of the sale. If there are multiple loans, one of the lenders for that loan may reject the payoff that is being offered to them. This action has the ability to set the whole process off target. Other impactful factors can include mechanic’s liens, outstanding homeowners or association dues, tax liens and liquid assets that can cover the shortage of the loan.

The Lauterbach Law Firm is proud to serve clients throughout Rockland County who are faced with legal matters related to estate planning, real estate, foreclosure defense, landlord-tenant law, business law, and criminal defense. If you require the services of an experienced team of attorneys, contact The Lauterbach Law Firm today to schedule a consultation.