03 Jul Avoiding Bankruptcy: Equity Stripping Scams
There was an article in the New York Times today about equity stripping. Many people who are in trouble with their mortgage payments may fall prey to these in attempt to save their house and/or avoid bankruptcy.
People often think the worst thing they can do is file for bankruptcy, so they do whatever they can to avoid it – even falling for one of these scams. Typically, the homeowner deeds the house over to the company thinking they are refinancing or that they will be able to buy the house back once they get on their feet. Instead, they find themselves living in a home that used to be theirs, and often still facing foreclosure.
Chapter 13 bankruptcy will stop foreclosure and give people up to five years to catch up missed payments. Chapter 13 may also be able to reduce other debts to help cash flow. If you are considering working with a mortgage workout company of any sort, talk to an experienced bankruptcy attorney first. You may be surprised about how much help Chapter 13 bankruptcy is, and you will have the benefit of running your options by an attorney who is 100% on your side.
Also see my article: Mortgage Assistance or Chapter 13 Bankruptcy?
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