Chapter 7 bankruptcy allows you to walk away from a mortgage you cannot afford. Chapter 7 will also temporarily stop a foreclosure and give you time to find a new place to live.
Chapter 7 is a liquidation rather than a reorganization of debt. There is no payment plan and there is no payment plan to catch up and repay missed mortgage payments. In other words, if you are behind on your mortgage and you file Chapter 7 bankruptcy, you will most likely need to surrender your home.
When you file a Chapter 7 debt liquidation, you can stop a pending foreclosure for a few weeks to a few months. After you file, the mortgage company will file a motion in bankruptcy court called a motion for relief from stay. In this motion, the lender will ask the bankruptcy judge to lift bankruptcy protection as to your mortgage so it can restart the foreclosure process.
The motion for relief process typically takes about three to four weeks to complete, at which point the lender has to start the foreclosure process over from the beginning. This means that, in most cases, you will have between four to eight weeks to prepare to move and to find a new place to live. Although filing for Chapter 7 bankruptcy will not enable you to keep your home permanently, it will give you breathing room and a chance to move on your terms.
Filing Costs: For a Chapter 7 Bankruptcy, the federal filing fee is $335.00. A credit counseling certificate is required to file. This counseling may be done at our office while we are opening the file.
We can also obtain your credit report. This is not mandatory but we find it to be very helpful if you don’t have a complete and accurate list of creditors.
Attorney’s fees: Stiberman Law charges a reasonable attorney’s fees in a routine Chapter 7 case and convenient payment plans.