How to Stop COVID Foreclosure and Repossession

As a Memphis bankruptcy attorney, I can attest that due to COVID, foreclosure and repossession are on the rise. At the absolute worst time for many American families to face these possibilities, when around half of all Americans lost income due to COVID, creditors are stepping in to make everything even harder.

Just as many of us are getting back to a “new normal,” creditors are getting back to their usual tactics, too; and as a result, millions of Americans are facing foreclosure and repossession due to COVID-19.

Here’s what’s happening and how you can stop it.

Stop Foreclosure Due to COVID-19

Thanks to COVID relief efforts, foreclosures hit a record low during the early days of the pandemic. According to Forbes, “There were 151,153 foreclosure filings in 2021, a 29% drop from 2020 and the lowest number in at least 16 years.”

Now those relief efforts are drying up, and mortgage lenders have begun foreclosure proceedings again. Last year saw a dramatic uptick in the number of foreclosures in 2021—at least 67% more than in 2020—and those numbers are only expected to rise in 2022.

Millions of people took advantage of mortgage relief programs during the first year of the COVID-19 pandemic—programs that include a federal foreclosure moratorium, the mortgage forbearance program, and mortgage servicing guidelines enacted by the CFPB. As those programs now come to a close, it’s unclear how many homes may face foreclosure. Experts say it depends on how many homeowners can work out an agreement with the banks to keep their homes.

That’s where we come in. Chapter 13 bankruptcy is a legally binding agreement that sets you up with a doable payment plan to get out of debt. It allows you to keep your house and take care of any other debts you may have too, including medical and credit card debt.

Because it’s legally binding, you can rest assured the bank won’t take your home—a huge relief after years of instability.

Stop Repossession Due to COVID-19

If you’ve looked at the price of a used car lately, you know the market is outrageous. Supply chain issues arising from COVID have kept new cars off the street, and as a result, the used car industry is booming. At the same time, the average cost of repossession has gone up because the towing companies have to pay more for workers, sanitization efforts, gas prices, etc.

That means repossession agencies need a financial boost. What better time than now, they may wonder, to come and take your car?

Repossessions slowed during the first year of the pandemic in large part due to government relief efforts. However, unlike with mortgage aid programs, the government didn’t pass protections explicitly for people who were behind on their car payments. As a result, repossessions grew in 2021 and are expected to skyrocket in 2022.

If you’re worried about car repossession, you’re not alone. Fortunately, just like with foreclosure, a Chapter 13 bankruptcy can stop repossession in its tracks. It’s legally binding and puts a stop to the threat of losing your car. Even better, it can cover your other debts and stop all creditor harassment.

A Memphis Attorney for Getting Out of COVID-19 Debts

After everything you’ve been through over the past few years, I have to assume foreclosure or repossession is the last thing you want to deal with. So let me handle it for you.

My bankruptcy firm is well-known in Memphis for helping thousands of people get out of debt and make a fresh start. We help people stop foreclosure and repossession and never look back.

There’s no reason to let COVID take even more from you than it already has. Now is the time to get your life back, and our attorneys are thrilled to help you do exactly that.

Contact us today at 901-327-2100 or by using the form below. We look forward to speaking with you.

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