Legal Question in Bankruptcy in California

Re: Filing Bankrutpcy effects on forclosure

Setting aside the bankruptcy issue for a moment, the foreclosure process takes several months. Once you stop making your payments, it could be several months before the bank starts a foreclosure.

The bank commences the foreclosure by filing a Notice of Default. This begins a 90-day hold period. After 90 days, the bank can file a Notice of Sale. At least 20 days notice of the auction date is required, so foreclosure takes a minimum of 110 days. Even then, delays are common.

After completion of the sale, the new owner must server you with a 3-day notice to quit. If you do not leave voluntarily, the new owner can file an eviction lawsuit. The process is just like the used when a tenant fails to pay rent. An eviction lawsuit can take several weeks or longer to resolve.

If you file for bankruptcy, the automatic stay stops the foreclosure efforts. Unless the court grants a motion for relief from the automatic stay, the bank cannot continue the foreclosure until the case has been discharged or dismissed. How quickly the bank files the necessary motion is up to them. A bankruptcy could give you several extra weeks to several extra months to stay in the property.