Can I Stop a Pending Foreclosure by Filing a Chapter 7 Bankruptcy?

Many individuals who are experiencing the Florida foreclosure process ask us here at Clark & Washington if a pending foreclosure can be stopped by filing a Chapter 7 bankruptcy. It will because it triggers what is referred to as the automatic bankruptcy stay. However, unlike Chapter 11 or 13 bankruptcies, it doesn’t function as a reorganization and repayment plan. Nor does this type of bankruptcy filing provide for repaying any delinquent payments on your mortgage loan.

Additionally, the “Statement of Intentions” that you provide with your Chapter 7 filing does not matter where surrendering your home is concerned. This is due to the fact that it will automatically create that “stay” and prevent a judgment or mortgage creditor from selling your home and/or property out from under you. Although it is possible, Chapter 7 bankruptcies rarely allow the debtor to get caught up on their payments or proceed with refinancing or even selling the property.

Clark & Washington is mid-Florida’s largest bankruptcy filer as well as being experienced and qualified at filing Florida bankruptcy cases in order to stop the Florida foreclosure process so that you are able to relieve the financial stress you may be encountering. We can handle a variety of bankruptcy cases whether they are Chapter 7, 11, or 13 (although we mostly handle Chapter 7 and 13 cases). Because we are located in the Orlando area, we can handle bankruptcy and foreclosure proceedings no matter where you are in central Florida.

Every now and then we do meet with clients who have filed for Chapter 7 by themselves without the assistance of an experienced Florida bankruptcy attorney. They may have filed by using the assistance of a petition preparation service as well, although this is not the best of ideas with any Chapter 7 cases. This is due to the fact that Chapter 7 cases cannot be dismissed on a voluntary basis. A judge must hear and approve any Chapter 7 case.

This is especially the case when your home’s equity exceeds the outstanding mortgage balance because the Florida bankruptcy judge may not consent to any voluntary dismissal of such indebtedness and the bankruptcy trustee can take possession of your home and/or property in order to sell it out from under you. For more information regarding this issue, please contact Clark & Washington at (407) 898-0299 or feel free to fill out the confidential contact form found on this website.