Foreclosure
This is the legal term for the loss of ownership that occurs when the mortgage company sells your home because you did not pay. The legal requirements for the mortgage company to foreclose are technical. Many foreclosures do not require that a lawsuit is filed prior to sale of the home. Quick action may allow the mortgage company to allow a forbearance agreement instead of foreclosing. Otherwise, a homeowner will usually file a Chapter 13 bankruptcy prior to the foreclosure to repay the debt over the life of the bankruptcy and save the home. The mortgage normally will specify the debtor will owe attorney fees if the debt must be collected. A Debtor must repay the late amount with interest in Chapter 13. A foreclosure may not be undone if the purchaser does not know the debtor has filed bankruptcy. Quick and timely action is required or the property may be lost.