The “Protecting Tenants at Foreclosure Act of 2009” gave tenants new rights. Some owners have heard that a tenant who signed a lease before the foreclosure notice was sent, may stay for the duration of their lease. This is an incomplete statement, though mostly true. The statute defines a tenant as a bona fide tenant. This means that the tenant is not related, signed the lease at “arms length” and is paying a rent amount that is not “substantially” less than market rent.

Once you file fore bankruptcy, your foreclosure may be accelerated, and thus, you may lose rent, though your tenant would be required to pay rent to the new owner.

In some cases, the new owner may ask that the tenant leave within 90 days. For further details or instructions related to tenancy and foreclosure, contact one of the attorneys at Starzynski Van Der Jagt P.C. for a customized solution to your needs.

Steps in a bankruptcy:
One of the biggest obstacles you face when you file a bankruptcy are the many bankruptcy deadlines. Some deadlines apply to Chapter 7 and some to Chapter 13, while others apply to both types of cases. This is merely a general overview and does not include all of the applicable deadlines because they are simply too numerous to list. As a general matter, below are some of the deadlines we track for you.
Step 1 – Meet with your attorney
Step 2 – Take your credit counseling class and get your certificate
Step 3 – Gather all your bills, social security card, driver’s license and last two years of tax returns
Step 4 – Meet with your attorney again
Step 5 – Complete all the forms
Step 6 – File all your forms with the bankruptcy court or have your lawyer do it electronically
Step 7 – Prepare for your first meeting of creditors with your attorney
Step 8 – Attend your first meeting of creditors at the courthouse
Step 9 – Provide any documents or other information requested by the trustee
Step 10 – Attend your second counseling class and get your Financial Education Certificate to your attorney
Step 11 – Wait for the objection to discharge deadline to run and wait for your Discharge notice in the mail
Step 12 – Begin making your chapter 13 plan payments within 30 days of filing your case
Step 13 – In a chapter 13 case, after you finish your plan payments, usually three years, you will receive your Discharge notice.

If you are working with a mortgage company to reduce mortgage payments or extend the loan, please continue to do so. It is always best to avoid bankruptcy if you can. However, you should have bankruptcy in mind and potentially be ready to file if necessary, because mortgage companies are not on your side. They may stall the process as long as possible, putting you at greater risk for losing your house. If you are currently in the process of negotiating with your mortgage company for loss mitigation or a loan modification, and you have a foreclosure sale date approaching, you should still consider and potentially be ready to file bankruptcy. Should the mortgage company not approve the loan modification or loss mitigation agreement, it will proceed to sale with little or no additional notice to you. Often you will not get a decision until your sale date is imminent, at which point it may be too late for us to assist you.

Both a Chapter 7 and s Chapter 13 bankruptcy can stop a foreclosure action. However, a Chapter 7 will only delay the sale temporarily, which allows some additional time to move, sell, or possibly refinance. It will not allow you to stay in the property unless you are able to cure all arrears immediately (within less than 30 days approximately).

Under Chapter 13, a person reorganizes debt and develops a three to five year repayment plan. Under Chapter 13, most unsecured debts (such as credit cards, medical bills, or any other debt for which there is no collateral) are reduced or eliminated, which allows your income to go to secured and priority obligations. Hopefully by reducing unsecured monthly expenses there will be enough income to allow the person to pay the regular mortgage payment and pay back the arrears in no more than five years. The debtor has up to five years to catch up on missed mortgage payments through the chapter 13 plan. This is much more time than most mortgage companies will offer through loss mitigation.

It is important to be prepared to file for bankruptcy before any pending home foreclosure sale. Waiting too long ¾ such as waiting until just weeks before the sale of your home ¾ may prevent you from being able to reorganize debt in time. Our experienced bankruptcy lawyers and staff will you help you decide whether it is a good idea to start a bankruptcy? So once again, if you intend or wish to stop a pending foreclosure sale and save the property through bankruptcy, you MUST FILE prior to the actual sale. This means that to be safe you should contact us at least one month before the sale date to ensure you will be able to file (if necessary).

If you are facing home foreclosure and are struggling to pay your bills on a regular monthly basis, bankruptcy may be right for you. Filing bankruptcy stops all foreclosure actions, buying you time to reorganize or eliminate some debt and catch up on mortgage payments.

The law office of Starzynski Van Der Jagt PC has worked for years exclusively in consumer bankruptcy law. Our skilled and experienced lawyers and staff will take time to explain to you the effect bankruptcy has on foreclosure. We will work with you to determine if filing bankruptcy is the best debt relief option for your situation..If you are able to afford your regular monthly expenses and current mortgage payment, but are unable to catch up on past due missed payments (arrears), then Chapter 13 may be a good option. A Chapter 13 will allow you pay back the arrears on your terms, as opposed to the mortgage company’s.

Contact our Denver based bankruptcy attorneys today for an initial consultation.