Legal Question in Bankruptcy in New York

Re: Bankruptcy

There are a couple of key issues for a debtor to consider when faced with a foreclosure.

First, is there any equity in the house, and, if so, how much ("equity" is difference between current market value of house less all liens and encumbrances). To get the answer to this question you may need to hire an appraiser to prepare an appraisal.

Second, is the reason the house is now in foreclosure because an inappropriate subprime loan was pushed on the debtor by an unscrupulous mortgage broker, perhaps with the assistance of others (such as appraiser, real estate broker, etc.). The debtor/homeowner may potentially have claims against third parties or counterclaims against the foreclosing lender. An attorney would need to review the facts applicable to the debtor’s situation to answer that question.

If a debtor has a valuable asset such as home with equity in it that he/she is trying to save he/she should hire an attorney and not try to be "penny wise and pound foolish" as the saying goes by doing it himself or herself.

You can find additional information about personal bankruptcy topics, including chapter 13, how it works, etc. on the Frequently Asked Questions (FAQs) on our website at www.starrandstarr.com/faqs.htm

The foregoing is not intended as legal advice regarding your specific situation and is intended as general information of interest to readers of this website. You should consult with an attorney regarding your specific situation. Feel free to call me at 8888678165 for a free no-obligation consultation.

Best regards,

Re: Bankruptcy

Your problem is a very common one these days.

To file for Bankruptcy Protection (the automatic stay) you must file under Chapter 13 for an 'Individual Debt Adjustment'.

CH13 is a little (not much) more complicated than a straight CH7. The difference is found in the requirement that you put together some sort of plan to pay the mortgage.

You must take this requirement very seriously because there are formal requirements for a CH13 plan and they must be met or the petition will be dismissed and the bankruptcy protection will be lost. If that happens, you will get only about 3 months of protection this way.

It is a good idea to meet with the 'work-out department' of your bank. They can do much of what you will accomplish through CH13 without as much paper and without recourse to a lawyer.