Legal Question in Bankruptcy in North Carolina

One unique result from the filing of any bankruptcy is the imposition of the Automatic Stay. Every creditor of a consumer who files a Chapter 7 or Chapter 13 must stop all collection procedures, including foreclosure. The last day possible to file to achieve protection is 9 days after a sale has occurred. That is because there is, in North Carolina procedure, a 10 day period following a sale to allow for upset bids. The deed which takes ownership from a borrower cannot be recorded until then. A bankruptcy interrupts the process and requires the creditor to wait for the end of the bankruptcy or ask permission from the bankruptcy judge to proceed further. The bankruptcy code under Chapter 13 allows the borrower to compel the mortgagee to take payments to cure the default. The cure period can be as long as 5 years. A filing under Chapter 7 will also stop the foreclosure, but the Automatic Stay is lifted at the time of discharge which is normally about 90 to 100 days after filing. If the debtor has not negotiated a deal with the mortgagee to reaffirm the debt and cure, then the creditor can resume foreclosure. Of course the debtor could then convert to a Chapter 13, make the payments and force the cure of default prior to that time. It is usually not useful to file a second Chapter 7 if unable to make a deal because the debtor must prove to the court that he/she is entitled to the automatic stay in a second filing or the second filing will not continue the automatic stay. You are also not entitled to file a second Chapter 7 if you have been discharged in a prior Chapter 7 within 8 years of filing. The answer to the question therefore is yes. The relief may be limited with just a Chapter 7 filing. Complete relief and a fresh start without the risk of foreclosure and loss of the home is available in a Chapter 13. One should consult with a lawyer who handles bankruptcy to see how bankruptcy applies in your particular circumstances. Tom Zimmerman

can i file a bankruptcy chapter 7 The bankruptcy stay will stop just about anything short of a charging Rhino. However you will have to work something out with the lender in the way of a re-affirmation agreement to keep the property after the bankruptcy closes.