But at what point of the foreclosure process can I still file bankruptcy?

by oliver on September 30, 2010

Question:

But at what point of the foreclosure process can I still file bankruptcy?

Is it too late to file for Chapter 7 bankruptcy if I already got the Notice of Default? Or do I still have time after the NOD? State is California.

Answer:

You can still file for a Chapter 7 bankruptcy at any time, up to and after the process of foreclosure. A Chapter 7 bankruptcy will not include the house debt but it only discharges unsecured debt such as personal loans, credit cards and a lot more. The filing of a Chapter 7 BK will have not have any effect with stopping the foreclosure process on your property or home.

If you want, you can apply for a Chapter 13 BK instead of a Chapter 7 before or after the foreclosure process. It can be used as a way in order to delay the auction or the sheriff’s sale. This delay will give you a chance to work things out with your lender and might come up with a payment plan. This type of BK will be the one that will put the foreclosure of your home on hold. It can be filed before or after your receipt of the Notice of Default. It can also be filed after the sheriff’s sale however, it will no longer include the house. This is because by the time the auction is finished, the transfer of ownership will take place and technically, you will no longer own the house.

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