In Pennsylvania, the foreclosure process can move very quickly without effective legal aid. Within a short amount of time, you can be dealt a harsh blow to your living situation and long-term financial outlook. But you aren’t defenseless. There are legal countermeasures you can employ to slow proceedings. Exercising these rights can give you more time to formulate a long-term financial plan.
A procedural defense points out a mistake the lender has made during the foreclosure process. Lenders may be wrong in any number of areas, particularly with regard to pre-foreclosure requirements or due process. Lenders are required to conduct proceedings in the following ways, and there are additional ways they may have violated your agreement:
- Lenders must provide proper notice (in Pennsylvania, Act 6 stipulates lenders provide written notice 30 days before court action)
- Lenders must give you a fair chance to correct the loan default
- Lenders must properly advertise the sale
- Lenders must introduce the original documents in the foreclosure proceedings
- Lenders must bring the foreclosure proceeding in the name of the real mortgage holder
If you believe your creditor has neglected to follow any of the above requirements, you may be able to use a procedural defense to slow down proceedings. The mortgage lender may be forced to start over, or at least become compliant before the foreclosure can continue. For you, the extra time can be used to refinance the deal, sell privately, or arrange a workout agreement. Filing for bankruptcy is another option.
Filing Chapter 7 or Chapter 13 Bankruptcy to Delay or Stop Foreclosure
The filing of a Chapter 7 or Chapter 13, automatically stops most creditor actions against you and your property, including foreclosure, foreclosure sales, and the filing of liens against your property. As long as this stay remains in effect, the foreclosure cannot be continued.
The lender can unlock the stay with the court’s permission, but acquiring permission normally requires over 60 days. The lender can also choose to do nothing, delaying the foreclosure until the Chapter 7 bankruptcy case ends.
A Chapter 13 bankruptcy allows you put a permanent halt to foreclosure proceedings. As part of the agreement, the lender will accept payment in installments, as opposed to a lump sum for all past-due payments. These installment payments can last between 36 and 60 months.
Foreclosure on your property does not need to lead to significant financial hardship. Any one or combination of these tactics may help you regain financial control in spite of the foreclosure on your property. I look for creative solutions to your foreclosure proceedings. The earlier you contact me, the more I will be able to help. Call me for a free consultation at (215) 854-6342.
Real Estate Foreclosure Sale Resources: