If you’re struggling with debts you can’t pay, avoiding harassing phone calls from debt collectors, or facing foreclosure, bankruptcy can help you get your financial life back on track. Filing either a Chapter 7 or Chapter 13 bankruptcy petition puts an immediate stop to all collection activities and can even help you keep your house. If you’re in danger of foreclosure, below are a few things you should understand about bankruptcy.

Bankruptcy & Foreclosure

When to File

Many people believe that they have to wait until after the bank forecloses on their home to file for bankruptcy, but this isn’t the case. In fact, Chapter 13 bankruptcies are designed to prevent foreclosures and repossessions by allowing struggling homeowners to catch up on their missed mortgage payments. In some cases, you may also be able to renegotiate the terms of your home loan to help avoid similar problems in the future.

How Chapter 7 Bankruptcy Affects Foreclosure

While a Chapter 7 doesn’t provide the same advantages for homeowners facing foreclosure, your petition may allow you to keep your home if you file in time. As soon as you declare bankruptcy, your lender has to stop trying to foreclose on your house for a limited time.

During the bankruptcy, you may be able to reaffirm the debt, meaning you agree to continue paying the loan and essentially avoiding foreclosure. With the majority of your unsecured debts discharged, you’ll also have more room in your budget to make the mortgage payments.

When you’re living in the shadow of unmanageable debt, the bankruptcy attorneys at Cecil & Cecil PA will help identify all of your options and choose the best path forward. This accomplished legal team provides trusted guidance to borrowers throughout the High Point, NC, area, building a reputation for exceptional service and expertise. For more tips and advice, follow their Facebook today, and call (336) 883-838 or visit their website to arrange your free initial consultation.