Texas is a great place to live. According to recent reports by Irvine, Calif.-based RealtyTrac, foreclosure activity in Texas was down in July, including first-time and repeat postings. According to reports there were approximately 9,968 home foreclosure filings reported in Texas during the month of July 2012, this a 5.7% decline from the same month last year. New home foreclosures are also down. According to the report, Texas had approximately 5,735 home foreclosures in July. This is an 8.1% decline from the same month last year.
How does Texas compare to the national average? Although total foreclosures, which include new foreclosures and repeat postings, are down the home foreclosure rate for first time properties was 98,174 for the month of July. This was an increase of 6.2 percent from the number of national home foreclosure starts posted last July.
What do I do if I am facing a home foreclosure?
While this news seems very optimistic for Texas homeowners you may be one of the nine thousand or so homeowners who are facing foreclosures this month. So what are your options for saving your home?
Although most experts suggest contacting your mortgage lender and discussing your options for payment, if you are have attempted to restructure your payments with little success you may be forced to consider filing bankruptcy.
The good news is that Texas bankruptcy laws provide for a homestead exemption that can help you protect your home from creditors if you choose to file either Chapter 7 or Chapter 13 bankruptcy.
Although you can lose your home if you stop making mortgage payments to the lender, Texas bankruptcy laws will generally protect your home from creditors if you choose to file for bankruptcy protection.
How does Chapter 7 Bankruptcy protect my home from a home foreclosure?
Not all debtors can file Chapter 7 bankruptcy; in fact, there are very strict income eligibility rules, but if you can file Chapter 7 bankruptcy you will be able to discharge many types of unsecured debts, while reaffirming your secured debts and continuing to make your mortgage payments. After the Chapter 7 bankruptcy is complete your home will be safe, while many other debts will be discharged including credit card debt, personal lines of credit and medical bills.
How Does Chapter 13 Bankruptcy protect your home?
Chapter 13 bankruptcy, which is available to many debtors who do not meet the income limitations for filing Chapter 7 bankruptcy, may be allowed to restructure their secured debt payments within a Chapter 13 bankruptcy plan. The reorganization plan may allow you to get a reduced interest rate, a longer payment term, or a reduction in the balance owed.
The reorganization plan will be for 3 or 5 years, and debtors will generally keep their home, assuming you are able submit a payment plan that is acceptable to the bankruptcy court and you continue to make your mortgage payments.
After completing the bankruptcy plan your mortgage payment, assuming the loan is not paid off during the plan, must be paid or the mortgage company could eventually seize your home.
If you are facing foreclosure it is time to take action. Talk to a bankruptcy lawyer about the options you have to save your home through a Chapter 13 or Chapter 7 bankruptcy.
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