Repossesion in Bankruptcy

Filing Bankruptcy Stops Repossesion

Repossession is a major problem in the United States.  Only 92% of mortgages are paid on time in America and an even lower percentage in Las Vegas and Nevada.  Foreclosure is not unique to Las Vegas or Nevada and neigher is bankruptcy.  Many individuals facing bankruptcy are also facing foreclosure.  There is a differnece of opinion regarding whether foreclosure or bankruptcy is better on your credit report.  However, if you are facing a foreclosure, you can stop the foreclosure and get all of the other benefits of a bankruptcy by simply filing a Chapter 7 or a Chapter 13 Bankruptcy.  Avoiding a foreclosure by filing a bankruptcy is usually a good idea.  There are anti-defficiency statutes that may or may not protect you from being sued after a foreclosure.  In some instances you can be held liable for the difference between what the home sells for at foreclosure and what you owed on the home.  This is called a defficiency balance and can be avoided in bankruptcy.

The Automatic Stay 

Whether you file Chapter 7 Bankruptcy or Chapter 13 Bankruptcy, you will be afforded protection of an "automatic stay" immediately at filing.  The automatic stay prevents any creditors from continuing collection efforts.  This includes both secured and unsecured creditors.  Anyone trying to collect an unsecured debt by calling or suig you will have to stop.  Anyone trying to collect a secured debt by repossession or foreclosure on your property will have to stop immediately.  Even if they continue with a repossession or a foreclosure, that transaction will have to be un-done if it happened after the actual filing of the petition.