When you fall seriously behind on your mortgage payments in the state of Arizona, you will eventually receive a “Notice of Trustee’s Sale.” This 90-day notice explains that, if no action is taken, your house will be sold at auction.
In Arizona, most residential homes are in a “deed of trust.” This ownership arrangement differs slightly from a mortgage, but many use the terms interchangeably. Unfortunately, a deed of trust makes it substantially easier for your lender to foreclose or sell your home at auction.
Our Gilbert, AZ foreclosure alternatives lawyer at D.M. Bankruptcy Law Group, LLC can work to save your home if you have received a Notice of Trustee’s Sale. We are familiar with many foreclosure avoidance strategies, and our experienced team has successfully assisted thousands of clients. No matter how dire your circumstances may seem, we are committed to helping you explore all available remedies.
The thought of losing your home to foreclosure is terrifying. As we begin to explore relief options, it is important to understand what circumstances led to this point.
If you are in danger of losing your home, several things must be true:
- You are behind in payments. To deliver the best possible results, we will need to understand how this happened. Did you lose income? Are you out of work? Are you still out of work?
- You are accruing late fees. A grand majority of lenders will charge late fees and interest when you fall behind on payments. This can make catching up even more difficult, and if you are receiving a Notice of Trustee’s Sale, you are likely behind nearly 6 months or more.
- You have likely incurred additional debt. Debt often leads to even more debt. You may have taken on substantial credit card debt to accommodate likely losses of income or in an effort to redirect funds toward delinquent real estate payments.
It is completely understandable to be stressed and upset, but do not lose hope. In addition to working to save your home, we can also help you address other outstanding obligations.
One obvious and unhelpful solution to stopping foreclosure is to pay the balance of arrears and penalties owed. Lenders will avoid foreclosure if they can and will cancel an auction if you “catch up” on payments. However, unless you unexpectedly receive a financial windfall, this approach is rarely practical.
Some individuals will simply decide foreclosure is inevitable and “walk away” from their homes. Do not do this! Giving up is a terrible choice, as there are almost always relief options available.
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Attorney Dutkiewicz is one of the most respected and sought-after debt attorneys in Gilbert. He has relieved millions of dollars of debt and guided over 1,500 successful cases.
- Negotiating directly with your lender. Foreclosure is an expensive and time-consuming process for lenders, so many will choose to avoid it where possible. Lenders may sometimes agree to a loan modification, which rearranges loan payments so that you are no longer in arrears. This will involve an extension of the total loan term and may impact interest rates. Modifications almost always result in your paying significantly more than what you originally agreed to. Lenders will also sometimes consider loan forbearances, which typically consist of a 6-month payment adjustment where you pay arrears on top of your mortgage payment. Because forbearances generally take place over a short period of time, the monthly payment is often very high. We can help negotiate directly with your lender and advise whether a proposed modification or forbearance is in your best interest.
- Selling your home. If you do not wish to keep your home, you could attempt to sell the property before the auction takes place, in effect avoiding foreclosure. If you wait until you receive a Notice of Trustee’s Sale, you may have trouble selling your home in the 90-day window. You will likely have to convince your lender to voluntarily agree to extend the Trustee’s sale date. If you are interested in selling your home as a means of foreclosure avoidance, our firm can connect you with an experienced real estate agent.
- Filing for Chapter 7 Bankruptcy. This is not a sure-fire way of saving your home, but it can buy you some time and help you discharge other unsecured debts, including credit card debt. When you file for bankruptcy, you benefit from the automatic stay, a court order that forces your lender to postpone the foreclosure auction. Your lender generally has the right to ask the court to proceed with the sale. Chapter 7 filers in Arizona can exempt up to $150,000 in equity in their primary residence from the liquidation process, but they cannot discharge missed payments. You may in limited circumstances be able to keep your home if you can discharge other debts and redirect funds to bring your loan current. If this is not possible, Chapter 7 bankruptcy can still be a useful remedy if you plan to surrender your home but have other debts that can be discharged.
- Filing for Chapter 13 Bankruptcy. If you wish to keep your home but cannot keep up with your loan payments due to losing income, Chapter 13 bankruptcy can be a great option. Like with Chapter 7 bankruptcy, filing entitles you to the automatic stay, which postpones an imminent foreclosure auction. The Chapter 13 process then takes the arrears and spreads them over the life of your repayment plan, which lasts between 3 and 5 years. You will address your existing loan agreement plus your mortgage arrears through this plan. In most cases, you will be able to remain in your home so long as you continue to make payments. Other debts can also be addressed as part of this plan, and certain unsecured debts may be eligible for discharge once you have completed it. We recommend Chapter 13 bankruptcy in many situations as a cost-effective approach to saving your home.
At the D.M. Bankruptcy Law Group, LLC, we can help you file for bankruptcy as late as the day before your home’s foreclosure or sale date. While we encourage more proactive solutions, our Gilbert, AZ foreclosure alternatives lawyer can help you navigate these emergency situations. Our experienced team regularly assists clients from all financial backgrounds and is prepared to help do everything possible to save your home.