Can Bankruptcy Be Used To Stop Foreclosure In Texas?

Yes. Bankruptcy can be used to stop foreclosure in Texas and bankruptcy is often used as a tool by homeowners in order to prevent a foreclosure.  Using bankruptcy to stop foreclosure is a powerful tool but can often be costly.  Many homeowners who are facing foreclosure see bankruptcy as a way to stop foreclosure without thinking about what happens after they file for bankruptcy.  If you enter into bankruptcy without a plan or without a solid long-term strategy, it could backfire.  At Capstone Homebuyers, we have been buying houses in bankruptcy and helping homeowners stop foreclosure for years in San Antonio Texas and we are ready to help if needed.  

How Long Will Bankruptcy Delay Foreclosure

Bankruptcy can delay a bank foreclosure for years if successful.  Bankruptcy can delay a foreclosure by a month or two if it is used by a homeowner only as a means of stopping foreclosure.  Different types of bankruptcies come with different types of rules.  If you are looking for a long-term strategy, entering into bankruptcy can buy you three to five years.  This is assuming you make your monthly payment arrangements created during your bankruptcy hearings.  If you are looking for a more temporary solution, you will likely file a bankruptcy to stop the foreclosure but then abandon the process once you have found a solution for selling your home quickly to avoid the pending foreclosure. 

What Happens If My House Isn’t Covered By Bankruptcy

Bankruptcy doesn’t protect your house from foreclosure permanently.  In fact, when the only goal of bankruptcy is to stop foreclosure, you can lose protection quickly.  Lenders can appeal and file a motion to dismiss, the bankruptcy judge also has discretion and may not allow your home to be covered by bankruptcy.  If any of these scenarios happen, you will be scrambling to sell your house fast so that the house isn’t sold at the foreclosure auction because the lender will resume the foreclosure process right away.  If you find yourself in this type of situation, make sure and find a reputable cash home buyer with experience buying houses in bankruptcy and foreclosure.  A company like ours, Capstone Homebuyers, has dealt with this issue many times and can act quickly and appropriately, and has the resources to be able to help. 

When Is It Too Late To Stop Foreclosure with Bankruptcy

Using bankruptcy as a last-minute option to stop foreclosure is possible up until the house is sold at the foreclosure auction.  There has to be time for your bankruptcy attorney to file the case with the bankruptcy court and there will be documentation needed from you and forms that you will have to fill out along with attorney and filing fees.  Some of the items you will want to be prepared for are the following: 

  • Bankruptcy petition
  • A list of your creditors
  • Credit counseling
  • Attorneys fees
  • Attorney Specific Documents
  • Filing Fees
Using Bankruptcy To Stop Foreclosure

Knowing that the foreclosure auction happens on the first Tuesday of every month in Bexar county, the absolute latest you could possibly hope to get a bankruptcy filing done and an automatic stay in place would be Monday, the day before the foreclosure auction is held.  If your plan is to only use bankruptcy as a temporary delay tactic, make sure you start working with your preferred home buyer immediately.  An experienced and qualified home buyer will work with your attorney to make sure everything is in place so that you can sell your home without delay.

Selling Your House During Bankruptcy

Selling your house during bankruptcy is always an option.  Sometimes that is the plan from the very beginning and bankruptcy is used as a tool to buy you time.  Occasionally, bankruptcy is the long-term strategy but it isn’t approved or your home isn’t covered or protected by the bankruptcy.  And sometimes, you are years into your bankruptcy repayment plan and life happens and you need to sell your house that is covered by bankruptcy protection.  If any of these scenarios happen, make sure you work with the right kind of home buyer.  A home buyer with a great reputation as well as the experience necessary to properly help and guide you through the process.  If you would like to know more about working with Capstone Homebuyers, we are always available to help…even if we don’t buy your house, we pride ourselves on helping members of our community.  

Sell Before Foreclosure

Selling your house before a foreclosure without using bankruptcy is often a very good option.  If you can’t pay a bankruptcy attorney, for example, you may just decide to sell instead of stalling the foreclosure for a short period of time.  If you find yourself in a complicated foreclosure or bankruptcy situation, give Capstone Homebuyers a call.  We will go over all of your options and make a recommendation free of charge.  If it turns out selling your house is the best option, we will give you a fair offer that you can count on to help you out of your situation.

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