Reed Law Firm, P.A. - bankruptcy

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Columbia, South Carolina borrowers may avoid foreclosure

Falling behind on one's mortgage payment can create a snowball effect of debt piling on debt. Sometimes a medical emergency or other financial loss create a shortfall from which the homeowner simply cannot recover. Columbia, South Carolina residents may feel they have no options when they receive the letter from the mortgage holder saying that the foreclosure process is pending. However, there are alternatives that may bring relief to many.

While the thought of personal bankruptcy may bring a negative reaction initially, for those who qualify, it may be a better alternative than losing one's home to foreclosure. In fact, as soon as someone files for bankruptcy, foreclosure procedures must halt until the court determines whether they may proceed. In many cases, if the homeowner has adequate income, the foreclosure can be avoided altogether, depending on the type of bankruptcy sought and the personal circumstances involved.

Chapter 7 will typically postpone foreclosure while unsecured debts are liquidated. Once these debts are discharged, the homeowner may be able to afford his or her mortgage payments. Chapter 13 bankruptcy, however, is usually more successful at allowing people to keep their homes because the person's unsecured debt is adjusted to match his or her budget. Sometimes, the court may rule that home equity loans will be converted to unsecured loans, which means they can be repaid at the same adjusted rate as other similar debt.

Every person's financial situation is unique, with its own complications. Having a Columbia, South Carolina bankruptcy attorney to evaluate one's finances can help a homeowner to understand what options are best for his or her circumstances. With the right guidance, there is a better chance that one will emerge from a financial crisis with hope for the future.

Source: CNN, "Bankruptcy can save your house from foreclosure", Les Christie, Feb. 12, 2017

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220 Stoneridge Drive, Suite 301
Columbia, SC 29210

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Florence, SC 29501

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