| Homeowners universally fear foreclosure during | | | | Chapter 13. |
| challenging economic times. Temporary income | | | | The cost of filing bankruptcy varies according to |
| reductions, job loss and unexpected cash | | | | the complexity of cases and the ability of |
| emergencies often prove too much to bear. | | | | attorneys. Attorney fees typically comprise the |
| Lenders also loath foreclosure but nevertheless | | | | bulk of costs incurred throughout the process. U.S. |
| initiate the process with little or no regard for the | | | | courts across the nation also regulate the amount |
| effect on families during temporary financial | | | | of fees an attorney may charge in a typical |
| setbacks. | | | | consumer case. Fees may increase however, |
| Most lenders throughout the U.S. consider | | | | upon request, if an attorney encounters unusual |
| foreclosure when a mortgage is three months | | | | circumstances or novel legal issues. |
| past due. Of course, a few lenders may be more | | | | Pro bono attorneys provide legal assistance to |
| understanding and allow more time. The most | | | | individuals without charge. In most situations, city, |
| effective way homeowners gain more time is to | | | | county and state bar associations provide a list of |
| give a lender advance notice of future | | | | resources for locating pro bono services. Income |
| nonpayment and further request temporary | | | | may be a qualifying factor. In addition, many |
| payment reductions. As long as a homeowner | | | | highly-qualified pro bono attorneys seek out clients |
| provides full disclosure and remains willing to work | | | | who are unfairly victimized by over-zealous |
| cooperatively with a lender, the odds of success | | | | creditors who may assert unfounded legal |
| improve dramatically. | | | | accusations. Overall, the ultimate decision to |
| At some future point, virtually all lenders enforce | | | | accept pro bono clients lies in the hands of |
| liens and post properties for sale when payments | | | | individual attorneys. |
| remain significantly past due. Everyone should | | | | The U.S. Code and local court rules regulate filing |
| expect a notice of foreclosure if falling four | | | | fees. Fees must be paid at the time of filing, or |
| months behind. At this point, for most people, the | | | | alternatively, debtors may qualify for a fee |
| burden of making four mortgage payments | | | | waiver. Any person or household that earns less |
| simultaneously is unfeasible. | | | | than 150% of the published poverty rate in their |
| Homeowners across the nation encounter a wide | | | | state of residency may receive a waiver. The |
| variety of state foreclosure statutes. Despite | | | | clerk of the court in each federal district provides |
| these differences, state statutes remain | | | | additional information, without charge, to anyone |
| predictably similar. A homeowner must receive | | | | who inquires. |
| advance notice of the intent to seize property. | | | | The clerk of each federal districts also supplies |
| Homeowners must receive a reasonable amount | | | | debtors with no-cost bankruptcy forms. The |
| of time to cure a default. In addition, all notices of | | | | official forms obtained from a clerk of the court |
| an intent to foreclose must be posted publicly, | | | | include instructions. These forms are the most |
| including the date, time and place of the intend | | | | current available at any cost. Be aware also that |
| sale. Few legal defenses exist to prevent to | | | | the instructions, although valuable, cannot contain |
| conclusion of a sale as long as payments remain | | | | legal advice for the benefit of debtors, creditors, |
| unpaid. | | | | or any party in interest. |
| Filing bankruptcy under any chapter immediately | | | | In small and simple cases, a few debtors file |
| invokes numerous debtor protections contained in | | | | bankruptcy successfully without incurring costs or |
| Section 363 of the Bankruptcy Code. The | | | | fees. In the vast majority of cases, most debtors |
| automatic stay provision of this section functions | | | | benefit far more by relying on competent legal |
| similar to a federal court injunction. After filing, | | | | advice provided by a bankruptcy attorney. The |
| lenders cannot legally demand payment, enforce | | | | risk of making a mistake can cost much more |
| liens, seize property or liquidate collateral. | | | | than paying attorney fees and many mistakes |
| Individuals who file bankruptcy receive automatic | | | | may produce far-reaching adverse consequences. |
| protection whether filing Chapter 7, Chapter 11 or | | | | |