One of the many questions that homeowners ask when they are on the verge of losing their houses is, “Will filing for bankruptcy stop foreclosure?”

The answer to this question is never easy to come up with because it depends upon the circumstances that are involved.  In some cases, the answer will be “yes” as many homeowners prevent foreclosure by filing for Chapter 13 or Chapter 7 bankruptcy.  Unfortunately, in other cases, the answer will be “no”.

After people file for consumer bankruptcy, an automatic stay is issued.  This stops creditors and collectors from calling people to collect debts that they owe.  However, this stay is only temporary and will only stop foreclosure for a short period of time.  Even more disheartening is the fact the mortgage lenders and banks can get around automatic stays by appealing to the court to issue lifts.  Once courts grant lifts, lenders will be free to pursue foreclosure.

You may be wondering how this is possible.  The fact is, a home is an asset that is secured by a deed of trust and your mortgage lender is allowed to ask the courts for relief from automatic stays because they financed the purchase of your property.  In order to remain in possession of your home and avoid foreclosure altogether, you will need to negotiate favorable terms with your mortgage lender.  You may also pursue loan modification or short sale by working with the team at American Economic Solutions as both of these alternatives could stop your foreclosure.

The bottom line is this, if you want to stop foreclosure, filing for bankruptcy is really a temporary solution and will provide short-term relief.  If you pursue bankruptcy, you will have to live with several consequences, such as having the bankruptcy on your credit report for up to 10 years.  Therefore, if you are facing foreclosure, it is to your advantage to consider all of your options by speaking with the specialists at American Economic Solutions.

If you are still seriously considering filing for bankruptcy, American Economic Solutions encourages you to work with our preferred partner, Scott Orona, an experienced bankruptcy lawyer.  Scott Orona has helped many homeowners get through the consumer bankruptcy process with little stress and in minimal time.  You can contact Attorney Orona directly by calling 619-306-7627 or by visiting his bankruptcy website:  http://www.sdbankruptcy.net/