23. Selling a house while in Bankruptcy (Chapter 13 or Chapter 7)

Foreclosure, Bankruptcy and Selling Your New Jersey House

Some homeowners that contact me are faced with two problems:  Foreclosure and bankruptcy (BK).  It’s a double whammer and unfortunately, many homeowners could have avoided an unnecessary bankruptcy.

Can I still sell my house if I filed for bankruptcy in New Jersey? Yes. For those homeowners who have filed bankruptcy already and are now facing foreclosure, you can still sell your home to avoid a full blown foreclosure on your credit.

Here’s a few things to note about Bankruptcy:

“Automatic Stay”

When you file for bankruptcy, the court issues an automatic stay which is basically a court ordered freeze.  In other words, nothing can be done with the house regarding a sale, transfer etc.  Wikipedia states: “The automatic stay means that the mere request for bankruptcy protection automatically stops and brings to a grinding halt most lawsuits, repossessions, foreclosures, evictions, garnishments, attachments, utility shut-offs, and debt collection activity.”

This is part of the reason why many homeowners choose to file for bankruptcy.  They believe this will stop foreclosure.  It’s unfortunate because most of the time it only delays the foreclosure process and now the homeowner now has a bankruptcy on their credit report.

Thinking about filing bankruptcy?

If you’re thinking about filing for BK, you should thoroughly investigate your situation and if BK can give you the desired outcome.  As I mentioned above, most often it does not accomplish what homeowners hoped for (saving their home from foreclosure).

If you are in foreclosure and are interested in selling your home to avoid the foreclosure or filing bankruptcy, please contact us today.  We can work with your situation to provide you a solution that meets your needs.  You can fill out the form on our stop foreclosure page or you can call us direct: 973-551-8210.  Don’t put this off any longer, it’s important to take action and we are here to help!

Related posts