For those facing financial challenges, and may be seeking to reduce debt or stop foreclosure, different legal options are available. A recent report on foreclosures in Colorado found that nearby Colorado Springs was the only community in Colorado that experienced an increase in foreclosures during the first quarter of the year. Although the overall foreclosure picture for the area has improved since the height of the recession several years ago, at least one real estate expert was puzzled by the rise in foreclosures in a report recently released by the Colorado Division of Housing. The reported increase amounted to 6.4 percent over last year's first quarter.
For those still facing foreclosure, and the stress associated with that possibility, legal options such as a Chapter 13 bankruptcy can help with foreclosure concerns. A Chapter 13 bankruptcy allows a filing party to reorganize existing debt into a manageable repayment plan. The repayment plan usually extends 3-5 years and is approved by the court. Once it has been approved, the filing party can begin repaying debt according to manageable payments approved by the court.
Once a bankruptcy filing has been made, an automatic stay immediately requires that all creditors cease collection actions against the filing party. Because of this, the filing party may be able to stop creditor harassment and also stop foreclosure. After filing, the filing party may then be able to bring overdue payments current in a reasonable time period. As such, the filing party may be able to repay missed payments as part of the repayment plan approved by the court and prevent foreclosure.
There are different bankruptcy options that share in common a fresh financial start for the filing party. Because of the different options and requirements, it is important to thoroughly understand how the filing party's circumstances, needs and goals can help determine which option is best for the filing party.
Source: The Gazette, "Colorado Springs bucks statewide trend as foreclosure filings rise in the first quarter," Rich Laden, June 4, 2014