Riverside Bankruptcy Lawyers – With the housing market in such disarray, coupled with a bad economy, clients who come into our Riverside Bankruptcy Attorney practice have questions about what solution is right for avoiding foreclosure: Chapter 7, Chapter 13, or a short sale of their property. A short sale is when the lender agrees to let the house be sold for less than what is owed on the mortgage, rather than seeking foreclosure. In our experience as bankruptcy attorneys, people usually believe that seeking a short sale of their house is their best option. But is it really?
In many cases, by the time our clients come in to seek the advice of a Riverside bankruptcy lawyer, they have been through a long cycle of trying to resolve their debts. As their financial burdens keep piling up, they may work with a credit counseling agency in an attempt to wipe out their credit debt, or maybe try to work out a tax compromise on taxes they owe, rather than getting advice from a Riverside bankruptcy attorney. Finally, in desperation, they try to sell their home to try to get out from under the mortgage payments. That’s when they really get a shock. Housing prices have been dropping all over, and we often find, in our bankruptcy attorney practice, that our clients are stuck with a house that has negative equity. They could be on the verge of foreclosure. It’s unfortunate when someone invested good money into their real estate over the years, and now they find it’s worth less than they paid into it. Now, the mortgagee can’t sell the house for enough to pay off the loan on it. That’s when they should look at a short sale.
In a short sale, the lender agrees to sell the house for less than what is owed to them. This may satisfy the loan debt. Unfortunately, what we sometimes see in our Riverside bankruptcy attorney practice is lenders who will not agree to a short sale. They also will not agree not to try to go after the borrower for the deficiency in the sale price. Also, many lenders will not finance a house that is being sold in a short sale.
That’s when you need to consider a Chapter 7 or Chapter 13 bankruptcy filing. If you qualify for Chapter 7 bankruptcy, it could cancel out all of your debts. In the case of a Chapter 13 filing, it could reorganize your debt, allowing you to catch up on any delinquent payments, thus allowing you to stay in your home. It could also allow you to strip away the second mortgage in a process called lien stripping, lowering your monthly payments and allowing you to rebuild equity in your property. In our practice as Riverside bankruptcy attorneys, we often find that people who were considering a short sale are often better served by a Chapter 7 or Chapter 13 bankruptcy.
Every client’s financial situation is different. That’s why you should consult with an experienced Riverside bankruptcy attorney, if you are contemplating a short sale. A Chapter 7 or Chapter 13 bankruptcy may be the best option for you, or a short sale, or possibly both a short sale and bankruptcy. To discuss what might work best for you, call 888.558.2992 for a free consultation with a bankruptcy attorney at the Law Offices of Harold D. Thompson, Riverside Bankruptcy Attorneys. Our 35 years of expertise in working with clients in financial distress can benefit you and possibly save your home.
As Riverside Bankruptcy Lawyers helping people with Chapter 7 & Chapter 13 Bankruptcy debt relief we are proud to serve the following areas of Riverside County: Riverside, Palm Springs, Banning, Beaumont, Blythe, Calimesa, Canyon Lake, Cathedral City, Corona, Coachella, Desert Hot Springs, Hemet, Indian Wells, Indio, Lake Elsinore, La Quinta, Menifee, Moreno Valley, Murrieta, Norco, Palm Desert, Perris, Rancho Mirage, San Jacinto, Temecula, Wildomar and all unincorporated areas of Riverside County.
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