• 15
  • September
    2010

Economic conditions over the last few years have left a number of people in difficult financial situations. For many, home foreclosure has become a very real possibility. In the wake of the real estate meltdown, state and local governments have been given a great deal of money to help individuals facing the loss of their home. In fact, just recently, the state of Tennessee was given another $10.2 million to aid in the fight against home foreclosure.

The most recent $10 million was provided to the state is part of a $1 billion plan called the Neighborhood Stabilization Program and is part of the recent Wall Street Reform and Consumer Protection Act. The money is intended to be used to help stabilize the housing market by demolishing or rehabilitation empty homes or help individuals cover down payments or closing costs in buying empty homes. The hope is that by shrinking the number of empty homes, it may help the housing market recover more quickly.

Of course, for those currently facing foreclosure a rebounding real estate market may not be the immediate relief they need. However, for those individuals, there are still potential solutions out there. For those facing imminent home foreclosure, a Chapter 13 bankruptcy filing may be one way to help prevent the loss of their home and address the circumstances that led to that point.

A Chapter 13 bankruptcy filing is what is sometimes called a "reorganization bankruptcy." It essentially allows someone to organize their debts into a plan allowing them to make affordable payments on their debts over the course of three-to-five years. As long as the filer can make agreed-upon payments on their mortgage, they can generally keep their home. At the end of that time period, some debts may be discharged or some may have already been paid off. In either case, an individual should be better financial shape at that point.

If you are facing foreclosure or the loss of your home, don't assume there is nothing you can do about it. You may be able to benefit from talking to an attorney about your options in bankruptcy.

Related Resources:

Tennessee granted $10M to fight foreclosures (Memphis Business Journal)