Worried about the bank foreclosing on your home? You're not alone, especially if you have an adjustable rate mortgage. According to a study by research firm First American CoreLogic, 1.1 million additional home foreclosures are expected between 2007 and 2013. Many Seattle bank foreclosures will involve adjustable-rate mortgages that reset to higher payments.
In the Seattle area, many homeowners have equity in their homes, so Seattle bank foreclosures that destroy this equity can be a serious financial problem. Consumers facing Seattle bank foreclosures need a lawyer. And they need to understand that bankruptcy, specifically one under Chapter 13, can stop Seattle bank foreclosures in their tracks. Chapter 13 is designed for people with regular income who want to pay their debts, but currently are unable to do so.
Chapter 13 gives homeowners time to cure delinquent payments and avoid Seattle bank foreclosures. To take advantage of Chapter 13 and stop Seattle bank foreclosures, homeowners must file for bankruptcy before a bank sells their home. After a Chapter 13 bankruptcy begins, a plan is developed that provides for repayment of mortgage arrears (and other secured debts). Under the plan, which runs for three to five years, a bankrupt person is allowed to keep enough income for living expenses. The rest is paid to a trustee, who pays off creditors. In other words, repayment to prevent Seattle bank foreclosures is made from future income.
In contrast, under a Chapter 7 bankruptcy, a bankrupt's assets are sold to pay off creditors. Chapter 13 prevents Seattle bank foreclosures only if homeowners make all payments required under the Chapter 13 plan. If they don't, banks can ask a court to lift the protection of Chapter 13.
If the court agrees, Chapter 13 will no longer prevent Seattle bank foreclosures. For homeowners facing Seattle bank foreclosures, Chapter 13 is good news indeed.
Please visit http://www.resolvelegal.com for more information about Seattle Bank Foreclosures.