Stopping a Pending Georgia Mortgage Foreclosure Using Chapter 13

 Mortgage foreclosure in Georgia can be stopped in only two ways. The mortgage lender can voluntarily stop the foreclosure proceeding, or you can file a Chapter 13 bankruptcy.

 Generally, you will find that mortgage companies will not voluntarily stop foreclosure proceedings. Under Georgia law, a mortgage company can start foreclosure proceedings once you are placed into default status because of missed payments. Usually, mortgage companies will wait until you are two or three months behind before they put you into default status and accelerate the mortgage. Acceleration means that the mortgage company has declared the entire payoff balance due and payable.

 Because mortgage companies are subject to federal and state banking regulations, changing the status of your account from “delinquent and accelerated” back to “current” is complicated and time consuming. Further, a “delinquent and accelerated” mortgage account will be referred to a foreclosure law firm that has its own case management process. Once the foreclosure process starts, our experience has been that most mortgage companies are not set up to arrange side deals with consumers who promise to cure delinquencies on a case by case basis.

You May Lose Your House to Foreclosure in Georgia as Fast as 37 Days After Foreclosure Notice is Published

 Georgia is a “non-judicial foreclosure” State, which means that your mortgage company and its foreclosure lawyer do not have to go before a state court judge to obtain permission to take title to your house through a foreclosure. Instead, they need only advertise a notice of the pending foreclosure sale of your property for four consecutive weeks in the official legal newspaper of the county where you live. This foreclosure notice serves to give you official notice of your right to redeem the property by paying the entire balance due. This notice also advises you that your property will be sold on the courthouse steps on the first Tuesday of the forthcoming month.

  Currently, Georgia law only mandates a 15 day notice of foreclosure to a delinquent homeowner. In 2008, however, the Georgia legislature is considering a number of revisions to the law that would extend this notice out to 60 days. At this point, however, the law remains strongly in favor of mortgage company foreclosure powers.

Mortgage Company Foreclosure Practices
Have Come Under Scrutiny

 In addition, the “assembly line” nature of the foreclosure process in Georgia has come under a great deal of scrutiny. Specifically, mortgage companies and their bankruptcy counsel have been sued by trustees and by debtors for failing to accurately credit accounts with payments and for adding fees and charges that were not authorized by bankruptcy judges or provided for in mortgage loan documents. The New York Times reported on the scope of this problem and spoke about a lawsuit filed by the United States Trustee against Countrywide Mortgage here in the Northern District of Georgia.

 We would not be surprised to see legislative action at either the state or federal level to address the problems that appear to plague the mortgage industry and its foreclosure process.

What Happens After the Foreclosure Process Starts

 Once your account has been referred to a foreclosure law firm, therefore, Chapter 13 bankruptcy remains your most realistic option for saving your home. Chapter 13 will stop any pending foreclosure up until literally the minute before your property is sold on the courthouse steps. It does not matter that the auctioneer may not have actual notice of your Chapter 13 filing. Unless the bankruptcy court has ruled to limit the applicability of the bankruptcy stay in your case, your Chapter 13 filing will invalidate any foreclosure sale.

 Contacting Clark & Washington as soon as you learn of a pending foreclosure remains your best course of action. Although we can handle emergency filings, we can serve you better if we have time to carefully review your intake questionnaire, meet with you and discuss your various options. However, if, for whatever reason, you you have an emergency and a pending foreclosure within the next few days, our firm is uniquely qualified to represent you in this emergency situation.