Stop Foreclosure in Decatur, Georgia
If your Decatur or Dekalb County, Georgia home is under the threat of foreclosure, bankruptcy is a legal method by which you can save your home. One of the fundamentals of bankruptcy is the automatic stay, which is the court order from the bankruptcy court that prevents creditors from making any collections efforts against a bankruptcy debtor, including foreclosure.
In Dekalb County, home foreclosures are scheduled for the first Tuesday of every month, and notice of the foreclosures are published in the Dekalb County Champion newspaper. If you fell behind on your mortgage payments and have a foreclosure scheduled, filing bankruptcy as late as the day before foreclosure will stop the foreclosure.
Chapter 13: Long Term Plan to Keep Your Home
Filing Chapter 13 bankruptcy will stop a foreclosure and also provide a long-term plan for keeping your home. In a Chapter 13 bankruptcy, case you will create a plan to repay the past due mortgage payments and other debts through a consolidated monthly payment to a person known as the bankruptcy trustee. The bankruptcy trustee disburses the payment to all of the creditors, including your mortgage company. Going forward, you have to pay the monthly mortgage payment in full for the months after you file bankruptcy AND you have to make one monthly consolidated payment to your Chapter 13 trustee.
For example, if you were $10,000.00 behind on your mortgage when you filed bankruptcy and you had $10,000.00 in credit card debt that you had to pay, your monthly Chapter 13 plan payment would be $400 per month to the trustee. In addition to the monthly trustee payment, you would have to pay your monthly mortgage as it came due, utilities, insurance, food, and other expenses. Thus, to file a Chapter 13 bankruptcy case, you must be able to afford both the Chapter 13 payment and your other regular bills. Debtors without income cannot file Chapter 13.
Chapter 7: Short Term Plan to Save Your Home From Foreclosure
When you file Chapter 7 bankruptcy, it stops a foreclosure in Georgia. However, the Chapter 7 bankruptcy does not create a repayment plan for creditors. Instead, Chapter 7 is what is known as a liquidation bankruptcy. Debts are wiped out subject to liquidation of property (which is unlikely). For debtors who have mortgage arrears, they must work out an agreement with the mortgage company to catch up on the arrears through a modification or must fully catch up on the arrears. Both scenarios are unlikely for a Chapter 7 filer.
Chapter 7 filers who file bankruptcy to stop foreclosures typically choose to surrender the home after bankruptcy. But, the Chapter 7 bankruptcy does stop the foreclosure and allow the debtor time to live in the house at least temporarily. When bankruptcy stops a foreclosure, the mortgage company must file a motion to lift the automatic stay or a special request with the court to be allowed to proceed with foreclosure again. After obtaining permission from the court, the mortgage company must proceed with foreclosure under Georgia law again, which means the mortgage company must publish the foreclosure sale for four weeks in the legal organ; in Dekalb County, that is the Champion.
If your Decatur home is scheduled for foreclosure and you wish to explore your options for keeping your house in bankruptcy, please consult with a bankruptcy attorney at the Law Offices of Charles Clapp by calling 404.585.0040.
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