As we enter into the first full week of May, many homeowners are facing the reality of not having the money to pay their mortgage. If they have just enough to pay the mortgage, with all the uncertainty of when the economy will be come back, many will be left with no choice but to keep the funds they have to pay for necessities like food and utilities. Most important is in the early stages of not paying your mortgage payment, is to contact the Lender and explain your situation. Many to almost all mortgage companies will have programs that on a short term basis allow non-payment or at least reduced payments each month on the current mortgage obligation. However every lender will have their own perspective on how much and how long they will work with the homeowner. The homeowner needs to start evaluating what they want to do with the house going forward. If the house has very little to no equity, then the homeowner may consider eventually walking away from the property. Foreclosure action, which is the civil action / law suit to have the house sold for nonpayment of the mortgage, usually take at least 9 months to complete, and in the current pandemic it is expected to take much longer than that. A homeowner can stay in their house up to the day of the Sheriff sale. If the homeowner wishes to retain the house, they can attempt to work out an agreement with the Lender to spread the missed payments amount over a period of time to pay it back, or have the arrears added on the principal balance and then paid off towards the end of the mortgage term. If the home has some equity, but not over what can be exempted in a Bankruptcy filing (i.e. there is an exemption in the Bankruptcy Code that allows for a fairly large amount of equity to be exempted from the Bankruptcy filing, thus allowing the homeowner to retain the house even with the equity), the homeowner can file a Chapter 13 Bankruptcy which would allow the arrears to the mortgage company to be paid off over the term of the Chapter 13 Plan, which is between 36 and 60 months. There is HOPE in the form of real options, as the fear is many homeowners will be facing tough times paying their mortgage starting in May and going forward.
Discussing your options with a New Jersey Chapter 7 and Chapter 13 bankruptcy lawyer as we go through and upon exiting this never before seen in history event, will allow Consumers and Small Business Owners to be informed of their choices and options under the Federal Bankruptcy Code. It continues to be the hope of all involved with Creditor /Debtor Rights that the private debt collection companies, mortgage companies, credit card companies, utility providers, Car lending companies, unsecured Loan providers, cell phone carriers, internet / cable providers etc. will offer options to help all Consumers and Small Business Owners catch up on late payments or restructure payments, however if they do not then all Consumers and Small Business Owners need to know their rights for Debt Relief through Bankruptcy.
Discuss Your Options under Chapter 7 or Chapter 13 with One of Our New Jersey Bankruptcy Attorneys in Confidence
To schedule a free, no-obligation consultation at Helmer, Conley and Kasselman, call us at 609-281-8581 or tell us how we can help online today.