If you are in danger of losing your home to foreclosure in a matter of weeks, you have a couple of options that you can exercise to possibly save your home. However, these can be temporary solutions and you need to take action immediately.
File for Bankruptcy
If you are suffering other financial difficulties in addition to being unable to pay your mortgage, consider filing for bankruptcy. There are a couple of benefits that come from filing. The first is that after you file with the bankruptcy court, the court will grant you an automatic stay. The automatic stay keeps all of your creditors, including your mortgage lender, from legally taking any action against you. Even if your home is on the verge of being foreclosed on, the lender cannot do anything to you.
The stay typically does not expire until the bankruptcy filing is completed. However, there is an exception that could put your home back in danger of foreclosure. If your lender goes to court and asks the court to lift the stay, you could lose your home. There is still an upside even if the stay is granted. Depending on the state in which you live, it could take one or two months before the lender can take action. You can use that time period to work out an arrangement with your lender or consider some other method to save your home.
Sue Your Lender
There are very strict law in place that regulate how lenders can proceed in a foreclosure case. If the lender fails to do that, the foreclosure can be challenged by you and your real estate attorney in court. The court can review the circumstances of the foreclosure and determine whether or not it is legal.
If the court does find that the lender did not follow the state laws for filing a foreclosure, the judge could rule that the foreclosure is not valid. As a result, your lender would have to go through the entire process again from the start. Depending on your state's foreclosure requirements, it could take months. During that time period, you and your attorney can possibly negotiate with the lender to keep the home and catch up on your arrears.
Even though a foreclosure is a scary thought, it is important that you directly deal with it. The sooner you take action, the more options you have available to you to save your home. For assistance, talk to a real estate lawyer like Bangs McCullen Butler Foye & Simmons LLP.