How to Stop a Sheriff’s Sale in Allentown, PA
A Sheriff’s sale is every homeowner’s nightmare. If you act quickly, you might have a chance to prevent the sale by filing for bankruptcy.
A sheriff’s sale usually happens after a homeowner fails to make mortgage payments on time and their home enters foreclosure. Generally, you must be behind by several months of payments before creditors initiate foreclosure proceedings. The Sheriff’s sale is the end of the foreclosure process, and the local government authorities will seize the house and auction it off, and the proceeds from the sale will be used to pay creditors. While most people hesitate to file for bankruptcy, doing so might halt the foreclosure process and prevent the Sheriff’s sale. You might have several options for bankruptcy, and the Sheriff’s sale should be put on hold until your bankruptcy case is completed, giving you time to make new financial arrangements. You should speak to your attorney immediately to avoid a Sheriff’s sale.
Call Young, Marr, Mallis & Associates at (215) 701-6519 and schedule a free review of your case with our Allentown, PA bankruptcy lawyers.
When Sheriff’s Sales Might Happen in Allentown, PA
Sheriff sales are a part of foreclosure proceedings, typically occurring at the very end of the foreclosure process. Usually, once creditors initiate foreclosure. Foreclosure is not always the first course of action, and creditors often send numerous notices before they resort to foreclosure. In many cases, creditors would rather work out a financial arrangement so you can catch up on payments rather than initiate foreclosure proceedings.
If no solution can be found, the creditor can file a lawsuit against you to get the money they are owed. The lawsuit is the beginning of the foreclosure process. How long it takes depends on whether you want to contest the foreclosure. You might litigate the matter in court or work with an attorney to explore other legal options. Typically, several months might pass between the filing of the lawsuit and the eventual Sheriff’s sale.
While the Sheriff’s sale might seem like the end of the line, there might still be hope. Legally speaking, the foreclosure is not final until the gavel comes down when your home is auctioned off. You have until this moment to take legal action and stop the sale. As such, you should speak with an attorney immediately.
Ways to Stop a Sheriff’s Sale in Allentown, PA
One way to stop a Sheriff’s sale is to put the entire foreclosure process on hold by filing for bankruptcy. You might think adding bankruptcy on top of foreclosure is simply making a bad situation worse, but this is not true. Bankruptcy is not a punishment, but it can be a solution to your financial troubles and help you keep your home under certain circumstances.
Chapter 13 Bankruptcy
When filing for bankruptcy, you can file for Chapter 13 bankruptcy. Chapter 13 bankruptcy allows you to restructure and reorganize your finances so you do not lose any important assets, like your home, vehicles, or other properties.
Under Chapter 13, the court allows you and your attorney to develop a reasonable payment plan to help you catch up on missed payments, including mortgage payments. Creditors may review your payment plan before it is finalized and express any concerns, and you might have to go back and forth until a final plan is devised.
Once your payment plan has begun, you must keep up with it for several years. At the end of the plan, if all goes well, the court may discharge certain remaining debts, and many other debts might be paid down.
Chapter 7 Bankruptcy
Chapter 7 bankruptcy is commonly referred to as liquidation bankruptcy. Under this chapter, you will sell off various assets and properties to pay for your debts. One aspect most people facing foreclosure are concerned with is keeping their home, and Chapter 7 bankruptcy might see your home liquidated and sold off. Our Allentown, PA bankruptcy lawyers can help you retain control over what assets are liquidated so that you can keep your home.
Generally, the person filing for bankruptcy is not in charge of selling off assets. Instead, a bankruptcy trustee is tasked with gathering and liquidating assets. Even so, this does not mean you have zero say in how your bankruptcy case proceeds. We can work with the trustee to avoid liquidating your home. This might be a good option if you have other valuable assets you do not mind parting with to keep your home.
What Happens to a Sheriff’s Sale in Allentown, PA After I File for Bankruptcy?
After you file for bankruptcy, several things happen that affect the Sheriff’s sale. First, an automatic stay goes into place that stops creditors from taking legal action against you for unpaid debts. The automatic stay would stop a creditor like a bank from initiating foreclosure proceedings or even contacting you to collect payment. Additionally, if there is an upcoming Sheriff’s sale, the automatic stay puts it on hold.
The good thing about automatic stays is that they take effect almost immediately as long as you have not filed for bankruptcy in the last few years. This means that even if the Sheriff’s sale of your home is happening very soon, you can file for bankruptcy and halt the sale.
While the automatic stay is in place, you and your attorney can work on initiating a payment plan under Chapter 13 bankruptcy or liquidating assets other than your home under Chapter 7. If your bankruptcy case is successful, you should be able to discharge some debts and hopefully hang onto your home.
When to Speak to a Lawyer About Stopping a Sheriff’s Sale in Allentown, PA
Once the foreclosure process begins, it can be difficult to stop. As such, it is imperative that you speak to an attorney about filing for bankruptcy as quickly as possible. If you have missed a few mortgage payments but foreclosure proceedings have yet to be initiated, you should still contact an attorney. The sooner you take action, the more likely you will avoid a Sheriff’s sale and keep your home.
Call Our Allentown, PA Bankruptcy Attorneys for Assistance
Schedule a free review of your financial situation by calling Young, Marr, Mallis & Associates at (215) 701-6519 and speak to our Pennsylvania bankruptcy lawyers about your case.