“Short Sale” is a real estate term that has entered our everyday language in recent years. A short sale is done when the market value of the home is less than the amount owed to the mortgage lender.  The mortgage lender must agree to take less than they are owed on the house so that the seller give the buyer good title to the house.   Here is where things get complicated.  The seller makes legal promises and warranties to the buyer, whether the house is sold short or at a profit.  This means that the seller can both lose money and be liable to the buyer into the future.  So, what happens after the short sale?

     The mortgage lender is still owed money after a short sale. This can add up to tens of thousands of dollars that is owed by the seller, even after the short sale is done! The amount left owing is called a deficiency balance. The lender can agree to forgive the deficiency balance and send the Internal Revenue Service a 1099 form.  They usually don’t. They will want the seller to sign a new loan agreement to pay the deficiency balance. It’s a loan payment without a house. There is another way.

     Chapter seven bankruptcy protects better than a short sale in many situations.  When a house is surrendered in bankruptcy, there is no deficiency to pay.  You have made no promises or warranties to anyone.  They get their house, you get your freedom.  The matter is quickly and discreetly handled.  Your fresh start begins sooner. 

     In most cases, bankruptcy law allows you to keep paying for your current house and automobile.  Each person’s situation is different.  Come talk to me for free.  I can tell you how bankruptcy can protect you and give you a fresh start.

In Alabama, the judgment allows the credit card lenders to take money out of your checking or savings account.  They can garnish your paycheck. This means that your employer is Ordered to take twenty-five cents of every doallar you earn and send it to the credit card lender that got the judgment against you.  If you own land they use the judgment to ask the Judge to put a lein on your home.  They get 1% interest every month that is added until the judgement is paid in full.

It sounds hopeless, but it’s not.  To protect yourself, you should act quickly before they have a judgment entered against your name.  I can protect you with a bankruptcy or a Federal Bankruptcy Court enforced debt reorganization.  Once they have a judgment, I can have it removed.  It just costs a little more to fix it.  Come sit down and let’s talk about your specific situation.  The first visit is free.

When considering an estate plan or a last will and testament, it is wise to consult a Wills and Estates lawyer AND an experienced Bankruptcy lawyer, if the estate would be overburdened with debt.  Planning now can preserve your gifts to your family later.

Not unless you tell them. No one puts a sign in your yard. Not even your mother will know. Bankruptcies are public record, but someone would have to look at your credit report or search the Courthouse records to see it.

Contact Bankruptcy Lawyer  Brent W. Davis

Once you are protected by chapter 13, be aware that your mortgage escrow payments may rise temporarily, so that the taxes can be caught up. All letters from the mortgage company or from the Court should be opened as soon as they come in the mail because the time to act can be very short.

Brent will meet with you personally at your free consultation.

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Did you know that the Founding Fathers of the United States of America specifically wrote your bankruptcy protections into our Constitution more than 230 years ago?  It’s true.  You can use a Federal Court protected debt repayment plan to stop home foreclosure, pay back what is behind on your mortgage, keep your car and other assets.  

No, most people who are up to date on house and car payments keep those debts and keep paying for them. State laws protect your clothes amd books and heirlooms and other household goods from being taken. You just lose the debt that isn’t working for you.

Contact Bankruptcy Lawyer  Brent W. Davis

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Brent W. Davis