by Adam Mack
HOW LATE IS TOO LATE?
We’ve discussed elsewhere how Chapter 13 bankruptcy can help you keep your home. But timing is everything, and the longer you delay in filing, the fewer options you have. Kansas law allows for a redemption period, however, there is still a time limit.
Before Foreclosure Notice: If you’re already behind in your mortgage payments and you’re considering bankruptcy, the best time to see an attorney about filing is before you receive notice of foreclosure. That will leave you plenty of time for you to protect your home. And occasionally lenders will help you get a loan modification rather than have to deal with a bankruptcy, which can sometimes spare you from having to file bankruptcy at all!
After Foreclosure Notice: Once you’ve received a foreclosure notice, the clock is ticking. If you want to save your home, you need to file for bankruptcy before the day of the foreclosure auction. See 11 U.S.C. § 1322. There are a lot of personal and financial documents needed before you can file, and depending on your circumstances, it can take days or even weeks to gather them all. A delay during this time period is going to hurt you the most.
After Foreclosure Auction: It is sometimes possible to save your home even after the foreclosure auction, but it isn’t easy and this really is a last resort. In a Kansas foreclosure, the law allows a “redemption period” in which you can buy your home back from whoever bought it at the auction. KSA § 60-2414. This “right of redemption” law applies to both sheriff’s sales (for people who lose their homes for failure to pay taxes) and to foreclosure sales. In re Smith, No. 08-12091 (KSBC). There are a lot of catches, though, the biggest one being that you have to pay the buyer whatever they paid for the house, along with any fees they may have incurred. For most people, that simply isn’t an option and they lose their home. If you’re overwhelmed with debt, if you’re behind on your home payments, or if you have already received a notice of foreclosure, talk to an attorney – the sooner the better. You have options for protecting your home, but the longer you delay the fewer options you have.
These articles are for general informational use and do not constitute legal advice. Since laws change over time, it’s possible some articles are out of date and for that reason, we make no representation that the articles are fully accurate. For actual, up-to-date legal advice (including a free consultation), please contact us!