Prevent Foreclosures

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When Lenders Wanted to Foreclose

In the past, when home values were high, lenders would not think twice about foreclosing on homes that were in default. When homeowners could not afford the monthly mortgage payments, the lenders would soon send notices to remind the homeowners to pay up. When they still did not get any responses or payments, they sent foreclosure notices. A few months later, if the homeowners could not pay or come up with solutions somehow, the mortgage companies would proceed with the foreclosure auctions. At the auctions, the banks would set opening bids which are roughly the amounts they were owed.

Lenders No Longer Want to Foreclose (most of the time)

When home prices were high and kept rising, there were hopeful buyers looking for homes that they could fix and sell for much higher values. So, the system worked out well for the banks and the buyers or investors. The problem is that now home values are low and many homeowners are upside down, as in they owe more than their homes are worth.

Lenders know that at foreclosure auctions, they cannot set the opening bids as high as they want to in order to payoff the mortgages owed. Homebuyers are looking for real bargains and they are not going to pay as much as the lenders need to recoup all of the money owed on each home. Also, the foreclosure process costs money. The process is risky for the banks as they might end up getting very little money back, or worse yet, end up with the homes that they cannot get rid of or do anything about. Remember, lenders are not landlords and they are not in the real estate business.

Selling Homes at Auctions

Right now, it costs the banks more to proceed with the foreclosure process than what they are going to get back. So, unless your home is in an up and coming neighborhood with real value, then the bank would prefer to work with you to come up with something that works for them and for you. If your home is in a bad condition and homes around you are not selling well then it is likely that you can work something out with the bank. Many banks have shown that they prefer to have the homeowners in the homes and making some payment rather than have them out if the prospect of selling the home is not good. This is why a short sale is attractive to the bank when a homeowner has no way of being able to afford the mortgage payments. By making the bank see that it is better to have you in the home, you can avoid foreclosure or live rent free for a while.

Facing Foreclosure Alone is always tough. You've got to stay in the loop! So in case you're new here, you may want to subscribe to the Prevent Foreclosures RSS feed. It will keep you up to date with the latest resources and tactics on how to prevent your foreclosure from happening.

• determine if you qualify for Chapter 13
• stop a house foreclosure
• estimate monthly payments
• devise an acceptable repayment plan
• complete and file forms
• make up missed mortgage payments
• pay off other debts
• represent yourself before a bankruptcy judge or trustee

The 9th edition is completely rewritten to reflect the recent (and massive) changes to federal bankruptcy law, as well as the latest bankruptcy exemption laws of your state. It also includes the most current legal documents and instructions on filling them out.

Whether you work with a lawyer or file on your own, you'll find everything you need to take charge of your debts in Chapter 13 Bankruptcy.

Please note: This book does not cover business bankruptcies, farm reorganizations or individual repayment plans (Chapter 13). For Chapter 7 Bankruptcy, see Nolo's How to File for Chapter 7 Bankruptcy.

State and Federal Exemption Charts

• Doubling
• Residency Requirements for Claiming State Exemptions
• Exemptions for Retirement Accounts
• Individual State and Federal Charts

Tear-Out Forms

• Voluntary Petition
• Exhibit C to Voluntary Petition
• Exhibit D to Voluntary Petition
• Schedule A -- Real Property
• Schedule B -- Personal Property
• Schedule C -- Property Claimed as Exempt
• Schedule D -- Creditors Holding Secured Claims
• Schedule E -- Creditors Holding Unsecured Priority Claims
• Schedule F -- Creditors Holding Unsecured Nonpriority Claims
• Schedule G -- Executory Contracts and Unexpired Leases
• Schedule H -- Codebtors
• Schedule I -- Current Income of Individual Debtor(s)
• Schedule J -- Current Expenditures of Individual Debtor(s)
• Declaration Concerning Debtor's Schedules
• Summary of Schedules and Statistical Summary of Certain Liabilities and Related Data
• Form 3A -- Application and Order to Pay Filing Fee in Installments
• Form 7 -- Statement of Financial Affairs
• Form 10 -- Proof of Claim
• Form 20A -- Notice of Motion or Objection
• Form 21 -- Statement of Social Security Number(s)
• Form 22A -- Statement of Current Monthly Income and Means-Test Calculation
• Form 22C -- ChaStatement of Current Monthly Income and Calculation of Commitment Period and Disposable Income
• Form 23 -- Debtor's Certification of Completion of Postpetition Instructional Course Concerning Personal Financial Management
• Form 201 -- Notice to Individual Consumer Debtor Under § 342(b) of the Bankruptcy Code Amendment Cover Sheet
• Daily Expenses
• Notice of Plan Amendment and Confirmation Hearing Date
• Proof of Service by Mail
• Chapter 13 Repayment Plan

Buy Chapter 13 Bankruptcy: Keep Your Property & Repay Debts Over Time