Posts Tagged ‘bankruptcy and foreclosure’

Get Ready for A California Foreclosure Wave

Tuesday, February 24th, 2015

There is a big wave coming to Southern California and it will not be found in the ocean. Foreclosures have hit their highest level in two years and should begin to affect real estate inventory soon, at least for a short period of time.dreamstime_5042227

According to new data released this month by RealtyTrac, one of the largest real estate data firms, the number of homes repossessed by banks in California in December reached the highest levels since December 2012 – nearly triple.

California’s Homeowner Bill of Rights, which is about a year old, has prolonged the foreclosure process for banks, who must now abide by the many protections provided homeowners under the bill, and now that the banks have had time to adjust to the new rules they are going after repossessions.

Notices of default, the first indication that a home is about to enter the foreclosure process, are currently at the same level they have been for the last six months, but will soon rise if all indications are correct.

Real estate agents and homebuyers will soon start to see more foreclosures and short sales popping up, just in time for the Spring selling season. But keep in mind that these sales are not the bargains they once were – even though banks want these properties off their books, they want to sell the homes for value as well. (click here for more information on the changing value of short sales).

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Can Bankrutpcy Prevent Foreclosure?

Tuesday, July 5th, 2011

Recently I heard of a desperate homeowner who was told to file bankruptcy in order to prevent foreclosure. But will this really work?

Foreclosure postponement reasons are outlined in the California Civil Code (section 2924 g (c) (2)), and can include mutual agreement, operation of law (such as charges of fraud against the lender), discretion of a trustee, request of a beneficiary and bankruptcy.

Many believe that filing for bankruptcy actually stops foreclosure, but the truth is that it merely puts a stay on all debt collection actions, for up to one year. This means that actions such as foreclosure cannot proceed until the debt is resolved by the homeowner, or until the lender obtains permission from the court to continue with the sale of the property.

If a homeowner can work out a plan to pay debt owed to the lender on the home than bankruptcy could be a good option. It gives the homeowner time to restructure obligations and devise a plan for paying them. In such a case a postponement could be beneficial. But if you are trying to find a way to stop foreclosure, bankruptcy is not such an option.

My advice is to speak with a bankruptcy attorney to see if this is a viable option for you. You need to understand all of the consequences of a bankruptcy, as well as your state laws, and you need to explore other options as well before filing. I also advise speaking with your accountant to see if there are other ways to structure your obligations.

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