When you fall behind on one or two bills, you may be stressed, but you can pick yourself up and get through it. But when you’ve fallen behind on your mortgage, you may find yourself receiving debt notices, foreclosure warnings, and more flooding your mailbox. If you are facing foreclosure in Ohio, you need The Jones Law Firm. Our bankruptcy attorney can show you how bankruptcy can help you in the foreclosure process.
In Ohio, the foreclosure process officially begins when your lender or bank files a foreclosure summons or complaint. Under the federal mortgage servicing laws, foreclosure cannot begin until you have been 120 days behind on your mortgage obligations. This 120-day period is intended to give the borrowers an opportunity to finance back payments.
While there is a 120 day period before the process may begin, your lender is not required to give you notice prior to the start of the case. However, your individual mortgage loan agreement may. These notices include:
Once the notice has been given or the foreclosure has been summoned, you then must respond to the foreclosure. In Ohio, you typically have 28 days to respond. Failure to do so may result in a judgment against you.
Once your answer has been filed, the court will review it. Because there is often no question that you are in fact, behind on payments, they will complete summary judgment. However, if something does make the court question the foreclosure, the case will go to trial.
Though you can object a foreclosure decision, some Ohioans find that going through foreclosure mediation is a better option for their future.
However, when a mortgage is not the only thing you are falling behind on, bankruptcy may be the answer to your foreclosure problems.
Before we dive into the benefits of filing for bankruptcy if you are facing a foreclosure, it’s important to know that you may have other options. Depending on the circumstances, such options include:
While these are only available in some cases, bankruptcy can often be the most cost-effective option in foreclosure cases.
All of this foreclosure talk may seem like there is no way out except to lose your home. But if you have mounting debts you cannot pay, foreclosure may be helpful to you. If you opt to file for Chapter 7 or Chapter 13 bankruptcy, the foreclosure process comes to a stop temporarily.
Much like other debts that will be temporarily paused in bankruptcy, foreclosure is part of the perks of the automatic stay. The automatic stay is the United States bankruptcy provision that temporarily prevents creditors, government entities, and collection agencies from pursuing debtors for the finances owed.
Under the automatic stay, your bank or lender cannot move forward with the foreclosure process.
Under the Ohio bankruptcy process, your foreclosure will be temporarily paused. However, knowing what you want out of the bankruptcy will determine what happens once the automatic stay ends.
Filing for Chapter 7 bankruptcy will delay the foreclosure process, but you will have to liquidate some of your assets. There are things you will be able to maintain like your home, car, retirement accounts, etc. Under Chapter 7 bankruptcy, should you not be able to keep the house, or simply decide not to, you will be able to walk away from the property after the sale without owing any remaining balance.
But if you want to preserve your assets and instead create a repayment plan, Chapter 13 may be for you. Under Chapter 13 bankruptcy, your debts will be lumped together in a repayment plan to be paid over the next three to five years. So long as you make these payments on time, the foreclosure process will be stopped. And in some cases, if you have taken a second and third mortgage on the home, you may be able to have those completely eliminated.
Knowing what you need versus what you want can be complicated. Don’t go at it alone.
If you are facing a foreclosure in the Columbus, OH, Reynoldsburg, OH, or the surrounding areas, bankruptcy attorney Michael Ryan Jones can guide you through the process of beginning your financial future. Contact The Jones Law Firm today to schedule a free consultation.