Hi everyone . Im new to this forum and find it to be very informative. I figgured id throw an interesting scenario i just came across.
I buy foreclosures in the NJ area. I attended a sale in which a property was sold at the sherriff sale. I noticed that after it was sold to a 3rd party investor , the sale was cancelled due to a chapter 13 filing by the owner. Is that really possible to file chapter 13 after your house was already sold at auction and get it back?
i was wondering if anyone can also give me a little insight as to the ramifications of chapter 13 especially in regard to homes in foreclosure? Im wondering why veryone who is being foreclosed on doesent just file chapter 13 to save their homes?
Any information regarding chapter 13 would be much appreciated???
If you have equity in your home that you want to save then it is worth while filing Chapter 13. Some file just to live free as long as possible.
In Deed of Trust states like Texas one needs to file prior to the foreclosure sale. I have personally filed at 8 AM the morning of the sale due no earlier than 10 AM. I too was getting property sold at a sheriff sale and had the owner file BK at the 11th hour. I do not know about Jersey law. Some states have the right to redeem on mortgage foreclosures and I do not know how a BK filing affects the sale or redemption if the filing if after the sale.
ANYONE ELSE KNOW ANYTHING BOUT CHAPTER 13. fOR INSTANCE DOES CHAPTER 13 ACTUALLY WIPE OUT PART OF YOUR MORTGAGE. iF THERE IS ANY WEBSITE THAT EXPLAINS THIS IN SIMPLE MANS TERMS I WUD APPRECIATE IT.
Chapter 13 might not even be an option for some folks anymore with the new BK laws in effect last September. Seems to me there are many restrictions and hoops to jump through now. It’s the best legislation the lender’s lobbyist money could buy, much to the detriment of middle class Americans. I’m not well versed on the nuances, but it sounds like some study on your end may save the deal for you.
Good luck!
Dave
Can not reduce mortgage debt with a Chapter 13 plan. Chapter 13 was designed to help debtors get caught up with the arrears over a 3 to 5 year term. Unsecured debt can be reduced if there is not enough income to repay the debt over the term of the plan. Most judges and trustees and lawyers will try to get as close to 100% repayent as possible.
Here in NYC, when we had a client whose property was about to go to the sheriff sale we would just have them file chapter 13. This would give us additional time to complete the sale. Here the homeowner has until the courts close the day before the sheriffs sale to file. In some cases I have seen it filed an hour before the sheriffs sale.
what normally happens in bankruptcy? does the judge reduce the amount of the loan? how is the loan restructured, does it give the homeowner more time with smaller payments?
im very confused as to what bankruptcy accomplishes for people in foreclosure. if anyone can explain it id greatly appreciate it ?
I got my chapters confused in the previous post. My apologies for any confusion. Since I just researched the BK laws, I’ll share what I’ve learned.
Chapter 7 isn’t an option for lots of folks in middle class America…there are huge hoops to jump through and coupled with the short-fuse foreclosure laws in many states, there’s not time to even entertain the notion of CH 7.
Chapter 13, being the most lender friendly (to the detriment of most folks, thank the lobbyists in DC); has the distinction of being available to anyone as a structured 3-5 year repayment plan. Your particular state may have homestead and other exemtions. The exemptions here are a whopping 6-8K here in my state.
Regards,
Dave
If your property is about to go to auction it puts a stop on it until the judge decides if you meet the requirements to file ch 13. This can give you additional time you need to close a deal and beat out the bank at foreclosing.
What happens when you follow through on the ch 13 I am not 100% sure of those details.
No the judge does not wipe out part of your mortgage, if you can’t pay then the trustee will oversee the sale of the property, but you can’t keep the property and dispose of part of the mortgage. You are given a set amount of time to catch it up.