As we’ve mentioned in previous blog posts, Las Vegas has increasingly become known as “Foreclosure City.” That means it’s also ripe for foreclosure scams.
If you’re worried about foreclosure, it can be tempting to work with “foreclosure consultants” or other non-lawyer options. They make it seem easy, uncomplicated, quick. The reality, however, is that foreclosure issues are complicated, and anyone who offers you a shortcut is most likely trying to take advantage of your.
In earlier bankruptcy blogs I issued a warning to clients and blog readers about “foreclosure consultant” scams. In just the past year and a half, the Indiana Attorney General has sued four companies for collecting fees from homeowners without ever contacting the lenders to negotiate on their behalf.
Even if there is no scam involved, there are at least five important reasons a homeowner should seek experienced legal help when trying to avoid foreclosure, according to John Ventura, author of The Bankruptcy Handbook.
Reason #1: There is a specific timetable of events leading to foreclosure.
Your must take certain actions by the time of each specific deadline, or the options for avoiding foreclosure will disappear.
Reason #2: You can put a halt to most proceedings by filing bankruptcy.
If foreclosure is imminent, the automatic stay of bankruptcy usually stops all collection efforts and legal actions while the court deals with your case.
Reason #3: You may be able to avoid foreclosure altogether with a Chapter 13 bankruptcy.
Reason #4: Even if you don’t qualify for a Chapter 13, a Chapter 7 bankruptcy can save you from having to make back payments and from delinquency fees.
Reason #5: An attorney may discover your lender does not have an enforceable lien on the home. For example, the mortgage lender or servicer may not have followed all required foreclosure procedures.
Even though the bankruptcy process itself does not deal in mortgages, as part of my own bankruptcy law practice, I’ve often helped clients avoid foreclosure. Sometimes that means helping them negotiate terms with their lenders. Other times it means using Chapter 13 bankruptcy to discharge a second mortgage, making it more feasible to keep up payments on the first mortgage.
The sad part of the story about the foreclosure scams is that often, even when the criminals were caught and punished, precious time was lost and deadlines were missed that made the difference between saving or losing a home. One of my very first blog posts was
“Looking For Help In All The Wrong Places”. I wanted to stress the importance of having an experienced Indiana bankruptcy lawyer help people go over each of their options.