How Does A Chapter 13 Affect Mortgages Or Foreclosures?
If your house is up for foreclosure, filing a bankruptcy in Virginia is the one and only absolutely surefire way that I know to stop a foreclosure. Virginia is a non-judicial foreclosure state, meaning that the courts do not have any knowledge that the foreclosure is taking place. It is advertised to take place on the front steps of a courthouse, but people inside the courthouse have no knowledge and when you go to the clerk’s office and say, “I need to see my file on my foreclosure”, they are not going to have a file, and they know nothing about it. They foreclosure could just as well be taking place on the front steps of the library, the grocery store, anywhere.
The reason we used the courthouse is because it lends some authority and credence to the activity of a foreclosure, but there are only two requirements for a foreclosure in Virginia. Number one is that they have to advertise in a newspaper of general circulation that is approved by the circuit court in the county where the property exists or resides. The second requirement is that they have to send you a notice by mail. You note I did not say certified mail, it does not have to be certified; it simply needs to be sent. If for some reason, that mail gets a big wind and comes along as the postman is putting it in the box and blows it down the mountain, well it is just too bad that notice was sent and that is all that is required.
We have had plenty of foreclosures where people did not get the notice and it is just too bad that the foreclosure still went through. So how the bankruptcy affects it is it does stop it, but it has to be filed what we say in Virginia, before the gabble drops. If somebody conducts a foreclosure say at 2 pm and we file the bankruptcy at 1.59, even though they did not have notice of it, it still stops the foreclosure even though physically it looks like it went through when they have knowledge that the bankruptcy was filed a minute before the gable dropped. It is too bad that bankruptcy has stopped that foreclosure. Conversely, if we do it at 2:01 pm and they say, “No, we have the foreclosure on time at 2 o’clock, you filed your bankruptcy 1 minute late”, that bankruptcy does not stop that foreclosure.
What it does for mortgages is it puts you back in the mortgage if you file it on time, and I have filed one that I thought was twenty minutes late, and I called the creditor and say, “Look, I’ll be honest. I filed it at 2.20”, and they said, “Lucky you. We didn’t have our foreclosure hearing until 2.21, so you win”. We have filed many times with one or two minutes to spare, we really do not like to do that, we like to file them a week before.
What Sets You And Your Firm Apart In Handling Bankruptcy Cases?
We always say that we care more than anybody else does, and secondly, we always do it right. If there is any problem with the petition, we fix it. Everybody makes mistakes; we have seen mistakes that were made because we did not have clear communication with our clients. If that happens we fix that. If something that somebody in our office does missed, we fix that as well. No case is perfect. I just hired a new associate and told him, “You have to have malpractice insurance and the reason is that everybody makes mistakes”, even judges make mistakes.
What sets us apart is that we take responsibility, and we try very hard to get our clients to be more responsible. Some of them are not, because they are not the most responsible people but we try to enlighten them. What sets us apart is that we teach people how to bring their score back to a 720. We have a program called 720 Credit Score, you can find it online, and we get them into that class and we just like to see their credit score come back as a result of them following our advice.
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