Any major U.S. city has its fair share of foreclosures, but in Philadelphia, the number is higher than average. According to a June 2015 Philadelphia Business Journal report compiled using data from real estate company RealtyTrac, “Greater Philadelphia’s foreclosure activity jumped 28% from last May, ranking it among the five worst metro areas in the nation.” If you’re a Philadelphia area resident and are worried about foreclosure on your home, you are urged to contact our Philadelphia foreclosure lawyers about your options for keeping your property, such as Chapter 13 bankruptcy. In the meantime, this article will help you understand when foreclosure proceedings are initiated in Pennsylvania, and what you can do if you’re worried about losing your home.
How Long Does it Take for a Bank to Foreclose on Your House in PA?
Your mortgage servicer, or the company you make your mortgage payments to, is prohibited from making the notice to start foreclosure proceedings until you are at least 120 days late on your mortgage payments. In other words, your mortgage servicer cannot begin the process of foreclosing on your home until you are at least four months delinquent.
This regulation was established in 2014 by the Consumer Financial Protection Bureau (CFPB). In the CFPB’s own words, the 120-day rule was created to “give borrowers time to submit an application for a loan modification or other alternative to foreclosure.” These actions, along with filing for Chapter 13 bankruptcy, are some of the potential options for avoiding foreclosure in Pennsylvania.
This touches on a crucial point for homeowners: while the 120-day rule is certainly a critical piece of information, the Pennsylvania foreclosure process should, and in many cases can, be stopped well before foreclosure actually becomes necessary. So what should a Pennsylvania homeowner do if he or she is concerned about facing foreclosure in the near future?
Can Filing for Chapter 13 Stop Foreclosure in PA?
If you think you might be reaching a point where you will be unable to keep up with your mortgage payments – or, even more critically, if you have already missed a payment – the time to review your options with an experienced Philadelphia bankruptcy attorney is right now, before the situation progresses any further.
We understand that foreclosure can be an extremely stressful subject of discussion; but the longer you wait to start laying financial plans, the fewer choices you will have when it comes to protecting your property. At this juncture, the very worst thing you can do for yourself is to ignore phone calls or warning notices from your mortgage servicer. Ignoring the problem will not make it go away – but confronting the issue proactively, with legal assistance from a mortgage foreclosure attorney, could yield a solution that allows you to keep and remain in the home you worked so hard to buy.
If you’re a Pennsylvania resident who’s concerned that foreclosure might be on the horizon, don’t panic: you have a few potential options, depending on your financial circumstances and how early it is in the foreclosure process. For example, you might consider talking to a foreclosure attorney about modifying your mortgage, or about qualifying for a pre-foreclosure forbearance plan.
As many Pennsylvanians who contact us are surprised to learn, filing for Chapter 13 bankruptcy may be another option to stop foreclosure in Philadelphia. This is because Chapter 13 bankruptcy allows homeowners to protect their property and prevent foreclosure by giving debtors extra time to catch up on mortgage arrearages, or missed mortgage payments. (On a related note, Chapter 13 debtors can also protect their vehicles from repossession, which is another major benefit of Chapter 13 bankruptcy.)
This is due to the defining feature of Chapter 13 bankruptcy, the reorganization plan, which lasts for three to five years depending on the debtor’s income and other factors. It’s important to point out that Chapter 7 bankruptcy does not feature a reorganization plan and therefore does not give debtors the same ability to stop foreclosure. What Chapter 7 can do is temporarily halt foreclosure proceedings, which is due to a feature known as the automatic stay, which is also part of Chapter 13 bankruptcy. Our Chapter 7 lawyers in Philadelphia can explain the automatic stay, your options for stopping foreclosure, and the difference between Chapter 7 and Chapter 13 bankruptcy when you contact Sadek & Cooper Law Offices for a free bankruptcy consultation.
Our Philadelphia Bankruptcy Lawyers Can Help Prevent Foreclosure
If you’re falling behind on your mortgage payments, or are worried that may occur in the near future, you need to take immediate action in order to give yourself the best likelihood of avoiding foreclosure and saving your home. Don’t let feelings of stress, fear, or embarrassment stop you from getting the help you need to keep your property.
Proudly serving the Greater Philadelphia area, including Bucks, Delaware and Montgomery Counties, our Philadelphia Chapter 13 attorneys are always ready to help Pennsylvanians work toward regaining financial control of their lives. We have helped thousands of people file for bankruptcy, and may be able to assist you, too.
Start going over your legal options today in a free, confidential, no-obligation consultation with our friendly and knowledgeable Montgomery County bankruptcy lawyers. All you have to do to get started is call our law offices at (215) 995-2543.