I plan to file Ch 7. Does the date of filing have any impact on a mortgage in default? I am currently 6months late on mortgage and have received the Intent to Accelerate letter from lender. However, the Notice of Default has not been filed.
Real Estate Attorney
You should wait. Sometimes notice of default never gets filed. More importantly, unless and until they set a sale date there is no reason to file unless your other debts necessitate your filing.
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Chapter 7 does nothing but slow down a foreclosure. Unless you can catch up the mortgage quickly, the lender will either get relief from the bankruptcy or wait until discharge when the stay ends and then possibly start foreclosure proceedings. Chapter 13 allows you to catch up the mortgage and reverse the acceleration.
[This communication is intended as general information and not specific legal advice, and this communication does not create an attorney-client relationship.]
Criminal Defense Attorney
Strategy comes into play here. If you can handle the stress of staying in your home when they are threatening sale - then unless you have someone else about to take property or garnish wages then it is a good idea to wait - because when you file the bank can come in and ask to lift the stay and the court will allow it. This doesn't give you the benefit of time in bk that you could have if you wait. For instance maybe it is 2 months before foreclosure sale takes place - if you file now it will give the bank a shorter period of time to obtain house. If you wait and watch the sale date you can file an emergency petition a day before the sale (although that is also stressful - you have to make sure nothing goes wrong with your filing, ;you have done your credit counseling and there is no glitch with the bk electronic filing system) At the time of filing you normally have about 30 days before the creditors meeting and the bank may not come in and ask to lift the stay. Your attorney can negotiate with your bank - or you may finish the 7 and then file a 13 to put the back payments into the plan. Which then protects your home for the 3-5 yrs you are paying the bk 13.