Filing Bankruptcy and Short Sales in Arizona
Bankruptcy rates in Arizona are on the rise, so are the number of short sales. A lot of the time filing for bankruptcy and a short sales go hand in hand. When a lender and a borrower work out a contract that allows the borrower to sell a property for less than the balance owed on the property, a short sale agreement has been reached.
A short sale is an agreement that benefits both the borrower and the lender. Short sales were designed as an alternative to foreclosure for owners who fail to meet the financial obligations of their mortgage. Short sales allow the borrower to avoid a foreclosure and allow the lender to get some money out of the property without going through the costly foreclosure proceedings.
One of the problems with short sales is that it takes time to not only find a buyer for the property but also for the lender to accept the terms of the short sale. The lender doesn’t care about the time or efforts by the home owner to short sale the property. The lender diligently continues on with their collection activity and foreclosure proceedings against the home owner. When the borrower runs out of time, quite often the home owners elect to file either a Chapter 7 or Chapter 13 bankruptcy.
Filing for Chapter 7 or Chapter 13 bankruptcy protection in Arizona provides the home owner with an automatic stay on the foreclosure proceedings and collection actions by the lender. The lender (bank/financial institution) is forced to cease the proceedings of foreclosure and collection practices until the bankruptcy proceedings have been completed. The bankruptcy filing also gives the borrower time to complete the sale of the property, usually providing them with more time than they would have had in a traditional short sale agreement.
More and more home owners in Mesa, Phoenix, and Tucson, Arizona are filing for bankruptcy in order to use the automatic stay provided to them by bankruptcy. They are using the time provided by the bankruptcy and automatic stay to complete their short sale. A traditional short sale agreement allows the home owner about 6 months to sell the house. Filing a chapter 7 or chapter 13 in Arizona can extend the short sale status for an additional 3 to 6 months. A lot of times, the extra time on the market (provided by the automatic stay) brings about a successful short sale.
If you find yourself running out of time while trying to successfully complete a short sale of your house in Arizona or if you are in the need of the automatic stay that is provided for you by filing bankruptcy in Arizona, you should get in touch with an experienced and trusted short sale and bankruptcy lawyer. The My AZ Lawyers can help guide you through your short sale and/or bankruptcy in Arizona. We offer: years of short sale and bankruptcy experience, payment plans, and some of the most affordable legal rates in all of Arizona. Contact Us today. Call (480) 833-8000 or (520) 306-8729. We are your affordable short sale and bankruptcy lawyers in Tucson, Mesa, and Phoenix, Arizona. If you would like more information? Visit us on-line at https://bankruptcy-az.com.