The following information includes frequently asked bankruptcy questions. The answers stated are general in nature and are not intended to apply to every bankruptcy and/or debt consolidation situation. Each case is different and carries its own set of circumstances which must be taken into consideration by competent legal counsel. By contacting Law Offices of Neil Crane, you will receive a personal consultation regarding your specific legal claim.
Q: Will bankruptcy stop my home from being foreclosed and/or my car from being repossessed?
A: Bankruptcy can prevent a foreclosure of your house or a repossession of your car. An "automatic stay" arises by law the instant a bankruptcy is filed. The automatic stay stops the foreclosure process and prevents any collection actions, such as repossessions or garnishments. Bankruptcy may also allow you to consolidate your mortgage arrears or automobile balance, and make payments on those debts over time through a repayment plan designed by Attorney Neil Crane.
Q: Will bankruptcy stop a lawsuit against me?
A: If you are being sued, we strongly urge you to speak with Connecticut debt-relief Attorney Neil Crane about filing for bankruptcy. A bankruptcy filing will stop a lawsuit immediately and prevent your creditors from placing a lien against your house or garnishing your wages.
Q: Do I have to go to court?
A: Not under Chapter 7, instead there will be an initial meeting of creditors approximately 30 days after the filing of your case. An attorney will be present with you at the meeting, which generally lasts for five to ten minutes. This meeting is generally held in an office building or a hearing room with your creditors. The trustee will ask you questions about your bankruptcy filing. You will have already answered these types of questions in prior meetings with counsel. Under Chapter 13, there is a one time court appearance that generally lasts five to ten minutes. Bankruptcy trustees and Judges are there to help you and will always treat you with the respect that you deserve.
Q: Can I keep my car and/or my home?
A: Yes, under Chapter 7 you would continue to make mortgage and car loan payments, while retaining your home and vehicle. Chapter 7 discharges unsecured debts, meaning your creditors are legally prevented from taking your car or home as long as you continue to make your regular monthly payments.
Q: Will I lose my personal possessions?
A: A properly prepared bankruptcy petition will protect all of your personal possessions. Bankruptcy law allows you to take exemptions to protect your home and personal belongings. While there are limitations, these exemptions are both generous and flexible.
Q: How do I rebuild my credit after filing for bankruptcy?
A: Although bankruptcy may be legally reported on your credit report for up to 10 years, you can begin to reestablish your credit immediately after your bankruptcy discharge. In fact, it is likely that pre-approved credit cards will arrive within weeks of a bankruptcy filing. However, borrowers should wait 1-2 years before obtaining credit cards, car loans or a mortgage to avoid higher interest rates.
Q: What is foreclosure
A: Foreclosure is the State Court legal process whereby the lender, tax authority or secured creditor takes back title to your house. It starts with the service by a sheriff of a foreclosure writ, which need not be served to you in hand, but instead is left at your property. The rest of the process happens in the county court house with notices sent by mail only. The court system requires that you file an appearance to assure receiving notice of all actions by all parties to the foreclosure. In Connecticut, foreclosure takes between 3 - 6 months and can be further delayed or stopped by competent legal action, including foreclosure defense.
Foreclosure is an important legal process that is intended by the lender to take your home. Seek immediate and experienced legal advice or representation if you are threatened with or undergoing foreclosure.
Foreclosure is just the beginning of a solvable and somewhat prolonged process. Don't panic. Instead, get prompt, experienced help.
Q: If I am in foreclosure, will I lose my home?
A. Absolutely NOT. Thousands of Connecticut residents in foreclosure save their homes every year. Don't rely on a bank, government agency or out of state website to save your home from foreclosure. Get legal advice. Many other alternatives fail to respond adequately or customize a response to your particular needs. Furthermore, discussions outside of the court process don't stop the court process. Unfortunately, many banks give people a false sense of impending resolution while the banks speed forward to take away your house through the legal process. No amount of discussion stops the court process.
- Connecticut law offers mandatory mediation on nearly all house foreclosures. This allows homeowners to present their case for mortgage modification to the lender at the courthouse.
- While foreclosure is extremely dangerous and stressful, it is also an opportunity for well prepared homeowners to present their case for modiification to the lender's attorney. Prompt. experienced legal representation saves homes and quick response to a foreclosure can actually be a great opportunity to get proper help and save your family home.
- Don't dispair — There are many ways to stop foreclosure and succeed in modifying your mortgage.
Q: Should I seek legal advice?
A: Whether you're in foreclosure or not, a properly qualified attorney has the experience to assist you and maximize your chances for success. Financial problems that involve your home are legal issues and an experienced Connecticut attorney can save your house. Don't rely on the assurances of non-qualified "experts," out-of-state companies or "friends" who have limited knowledge or experience. All foreclosure problems are difficult, your situation is specialized to you and needs to be treated with an importance and uniqueness that is specific to y our exact problem and the proper solution.
Q: What are my legal options?
A: Connecticut has various laws to protect homeowners from foreclosure. They include the right to de-accelerate your loan by arranging for back payments, underemployed or unemployed, foreclosure protection and mediation. Mediation in court has become an excellent option available to all Connecticut residents who take proper advantage of the state law protection for homeowners. There are also various legal defenses to combat modern day lending and foreclosure abuses. There are also federal laws that are available to rescue Connecticut residents from losing their home through foreclosure.
Q: Should I pay my credit cards if I'm struggling with my mortgage?
A: Many borrowers continue to pay high interest unsecured credit card debt while they're in the process of losing their homes. This is a major mistake, but it occurs on a regular basis for a few reasons:
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Borrowers truly do want to pay and have been trained to make timely monthly payments even if they can't afford to make the payments, and are actually in jeopardy of losing their homes.
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People want to pay someone, or as many people as possible so they don't have problems and battles with everyone. They deplete their available money in an effort to pay as many creditors as possible, even when it doesn't solve their real problem and actually can make it worse.
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People are very concerned about their credit score and will go to all lengths to preserve their score, even in part, by making payments on as many bills as possible. Of course, this doesn't help because credit score has nothing to do with a successful mortgage working or modification and credit scores will be impaired by the mortgage default.
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People pay credit card companies to avoid the interest rate increases and brutal late charges imposed by threatening credit card collectors. In most cases this doesn't avoid the imposition of these fees and costs anyhow, as credit card companies can legally raise your rates for any reason they deem appropriate.
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People pay credit card companies and waste precious financial resources that could better go to their mortgage/house to avoid relentless phone calls from credit card companies and collectors. Collectors for unsecured debt can call many times per hour on a daily basis and people often give in and deplete their monthly budget to avoid the endless and often harassing phone calls at home and at work. Giving in to these threats and harassment is a common mistake, even though you have a right to not be contacted by telephone.
Credit card or unsecured debt is the last thing you should pay. It does nothing to feed, clothe or house you or your family. Most credit card payments accomplish nothing, since all the payment goes strictly to interest on past purchases and provides nothing for a family's present needs today.
Saving your house is far more important than paying credit card debt and in fact, credit card payments are among the leading causes of home loss in America. Paying high interest unsecured debt robs families of the resources necessary to save their homes from foreclosure. Which would you rather have, your house or a maxed out credit card? If you are facing a choice, pay your mortgage, not your credit cards. You can handle unsecured debt later. They can't take anything from you, and they're always negotiable for a small dividend on the dollar.
