Stop a Memphis Foreclosure in Time
If you’re facing foreclosure, your timeline will depend on a few factors, including where you live. Here in my home state of Tennessee, we have certain rules that determine when it’s too late to stop a foreclosure in Memphis.
As a Memphis bankruptcy lawyer, I’ve seen people make the horrible mistake of assuming they have more time than they do. So here’s what you need to know about keeping your house when you’re at risk of foreclosure.
The First Warnings of Foreclosure
In Tennessee, the delinquency period is usually 90 days. That means after you’re about 90 days behind on your mortgage, your lender will start collections attempts against you.
The bank will first warn you that you’re in default. They will likely tell you how, if you don’t pay soon, you could face penalties beyond the normal fines and late fees. In addition, they might make calls to your home like any creditor.
During this time, it’s important to get back on track if you’re able. With every late payment, you damage your credit, add potential late fees, and increase the likelihood of foreclosure. But for most people, multiple missed payments aren’t that easy to make up.
The Foreclosure Process Timeline
Generally after about 120 days of missed payments, the lender will issue a notice of their intent to foreclose. They will inform you as well as the public.
The lender’s foreclosure attorney may send a threat of foreclosure, usually in the form of a letter. Then they’ll post a notice in the newspaper and possibly online that informs the community of the intended sale. The official notice you receive will have dates on it, so you can plan accordingly.
This is called the notice period. It usually runs for about 5 weeks, and then your home can be auctioned.
Using Bankruptcy to Stop Foreclosure
Before the sale, you have a few options if you want to save your home from foreclosure:
- Catch up on your missed payments
- Try negotiating with the lender
- Use bankruptcy to stop the process
Obviously, the ideal course of action is to catch up on your missed payments. For most people, if you could afford to do that, you wouldn’t be behind to begin with.
Next, you might want to try negotiating with your lender, especially if you can make some of the missed payments and could get back on track soon. Sometimes a health scare or other short-term emergency makes it hard to pay for a while, but then when everything goes back to normal, you can get back on track. In rare circumstances like that, banks might be willing to work with you.
Lastly, you have the option of Chapter 13 bankruptcy. Chapter 13 is a tool that helps you keep your home and other assets when you fall into debt.
As soon as you file Chapter 13, the courts place an automatic stay on the foreclosure process – which means the banks are no longer allowed to sell your home out from under you.
In a Chapter 13, you and your lawyer work with the courts to set up a payment plan you can afford. Instead of having to make a big mortgage payment every month along with all your other debts, now you only have one monthly payment – and it’s designed based on your income.
Help to Stop a Foreclosure in Memphis TN
If you need to stop a foreclosure in Memphis, you don’t want to wait to handle your debt. Once the sale occurs, it’s final. In the state of Tennessee, there’s no getting it back unless you buy the house all over again. (There may be an exception if the only debt you owe is property tax debt, in which case speak with your attorney).
For decades, our Memphis bankruptcy firm has helped thousands of people save their homes from foreclosure. While we do everything possible within the time limits, we’ve seen people wait until it’s too late.
Don’t let that happen to you. We offer a free consultation, no strings attached. So you have nothing to lose to speak with someone about your options.
We would love to help you stop foreclosure in its tracks. To get started with a free appointment, contact us today.