You would still have the right to defend the foreclosure action. The impact of the bankruptcy will depend on various factors such as whether there is equity in the property. You may have other options, such as addressing the arrears in a chapter 13 or attempting a mortgage modification
No. The filing of the Chapter 7 would stay the foreclosure proceeding while the bankruptcy case was pending, until such time as the mortgage company obtained relief from the stay or the chapter 7 trustee abandoned his interest in your home. However, you would not waive your right to file a contesting answer to the foreclosure complaint due the filing of your Chapter 7 case.
Be mindful though that you would have to file your answer to the foreclosure complaint within the 35 days of being served with the complant and it you blow that deadline, you would first have to file a motion to allow you to file your answer out of time and provide the Court with the factual basis/ reason why you were unable to file the answer on time. Good Luck.
Both Mr. Braverman and Mr. Capone have given you good answers regarding your right to defend your foreclosure complaint. While you are in the bankruptcy case you may be in a good position to address the mortgage issues that have caused the foreclosure. If you have a bankruptcy attorney you might want to discuss the possibility of a modification while in your Chapter 7 case or the possibility of converting your case to a Chapter 13 case and seeking a modification through the Court's Loss Mitigation Program or curing the arrears through a Chapter 13 cure Plan. Don't miss an opportunity.
Bruce C. Truesdale
No. Whatever rights you had as of the bankruptcy filing are preserved for a period of time. What those rights are depends on where matters stood when you filed your bankruptcy. And until the trustee abandons your home you have less control in this matter.
The foregoing answer is for informational and educational purposes, not for purposes of legal representation. This answer is based on New Jersey law and is necessarily general in nature.. Laws in other states may be different, and each situation is different, so this answer might not apply accurately to you. No attorney client relationship is to be implied from this answer. Always seek independent legal advice.
Let me break this all down for you. The Bankruptcy puts a "stay" in place that stops all other proceedings. That means that neither you nor the bank can move the foreclosure process forward. You would most likely want to wait until you see how the Bankruptcy turns out before answering the Complaint. But, by all means, hire an attorney and get your Answer ready. You'll also want to be prepared because the foreclosure attorneys are likely to prepare a Motion to Stay Foreclosure in the very near future. You should get a local foreclosure attorney on board as soon as possible to assist you with these matters. You will most likely be before Judge Velasquez in Jersey City on this case, but you won't have a Judge assigned until you file the Answer.
You can still work with the bank on a modification while the Bankruptcy is progressing and discuss with them possible alternatives to foreclosure.