MORTGAGE BLUES

First some facts: A foreclosure in Colorado takes 120 to 125 days from filing to final sale. The sale must be published in a local newspaper for 4 consecutive weeks. No one can assert a right to trespass, change your locks or have you evicted before that sale happens. On the other hand, you have plenty of options. Here are a few:
1. You can file a Chapter 7. This is what most people think of when you mention bankruptcy. Bankruptcy is federal law and all state law actions (like foreclosures) are stayed until the bankruptcy court gives its permission for the sale to proceed. This takes between 30 to 90 days depending on how fast the lender acts. If the bankruptcy is filed before the last publication in a newspaper, the foreclosure must be re-started from the beginning. This can keep you in your home rent free for a year or more!
2. If you want to keep your house, think about filing a Chapter 13 (even if you have recently filed a Chapter 7). This is a payment plan which can last for up to 5 years. You can pay back your missed mortgage payments over that time and they can't add any additional interest. Another Chapter 13 feature is that it is often possible to “strip off” a 2nd or 3rd mortgage. I've done this dozens of times. Also, if your vehicle is “upside down” you can put it in the plan and only pay what it is actually worth.
3. Either Chapter will allow you to get rid of judgment liens on your home. Also, IRS and CDR income taxes are dischargeable in both chapters if they were due more than 3 years ago, the tax returns have been filed for at least 2 years and the taxes were assessed at least 240 days prior. If those 3 factors exist, the taxes are gone!
4. Nothing prevents you from pursuing a mortgage modification during the process. Most lenders now have a loan modification or a loss mitigation department. You are free to negotiate with them and they can't take any action against you while the bankruptcy stay is in effect.

I have 30 years experience and am licensed in all Colorado State and Federal Courts. I handle both Chapter 7 and Chapter 13 cases, whether business or consumer, and I give everyone a FREE consultation with no obligation. We are a federally designated Debt Relief Agency and help people by utilizing the bankruptcy laws (among other options). I accept cases statewide.

Got questions? Get Answers!

Timothy Canty, Esq.
(303) 670-2185

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