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What is foreclosure and bankruptcy seasoning?

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βˆ™ 2015-07-17 17:57:27

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Foreclosure is basically the act of foreclosing, especially a legal proceeding by which a mortgage is foreclosed. Here in California, for example, a lender can foreclose on the deed of trust if you don't pay your mortgage. The bank or note holder goes through an extensive process to sell the property at public auction to the highest bidder. Some foreclosures require court action, others do not.

Your reference to bankruptcy seasoning is a little unclear. Creditor attorneys will sometimes refer to a lien as "seasoned" if the lienw as created outside of the preferential transfer period in federal bankruptcy law. Federal bankruptcy law allows a debtor to recover certain payments or "preferential transfers", that were made to a creditor a short time before the filing of the debtor's bankruptcy. A judgment lien can be a transfer and can be a preferential transfer if the lien arose within the 90-day time period prior to the filing of the bankruptcy.

Foreclosure and bankruptcy seasoning is commonly used in the mortgage industry referring to the time period that must elapse before a borrower is eligible for a loan. ie. To purchase a home using an FHA loan the foreclosure seasoning requirement is 3 years, therefore 3 years must have elapsed since the previous home was foreclsosed. Unless the foreclosure was due to extenuating circumstances such as the loss of the primary wage earner or a situation beyond the borrowers control. It must be a really good reason before a lender will reduce the 3 year restriction. The bankruptcy seasoning requirments are 2 years from the discharge date for a chapter 7 and 12 months for a chapter 13 bankruptcy with court approval on an excellent payment history on the trustee payments. The seasoning requirments for conventional loans are much longer in the midst of these volatile lending conditions. Please consult your mortgage advisor for details.

2015-07-17 17:57:27
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Related Questions

Will bankruptcy protect me from foreclosure by my mortgage company?

Yes, bankruptcy protect you from foreclosure by your mortgage company. You can read more at www.hirby.com/mortgage-lender-filing-for-bankruptcy


Bankrupty or foreclosure which is best?

bankruptcy is better. If you have to decide foreclose or banko, put your house in bankruptcy. When you have a foreclosure, they can sue you for the balance


Do you have to file bankruptcy after a foreclosure?

No, there's no law that states you have to file bankruptcy.


How long will bankruptcy prevent a foreclosure?

Bankruptcy will prevent a foreclosure but you still have to reaffirm the loan and begin paying or the bank will repossess your house regardless of bankruptcy. Bankruptcy temporarily halts the process for up to a couple months.


Does a timeshare foreclosure hurt your credit after a bankruptcy has been discharged?

Any foreclosure or bankruptcy affects your credit. And for anywhere from 7 -10 years.


How bad is it to do a foreclosure and a bankruptcy at the same time?

You technically should not be able to do both at the same time. The bankruptcy should stop the Foreclosure proceedings in its track.


Can you file bankruptcy on your house if already in foreclosure?

Filing for bankruptcy may enable you to recover your house from foreclosure. However the bankruptcy would entail dealing with your entire debt situation, not just the house.


Is filing bankruptcy on your home considered a foreclosure?

No. Foreclosure is a specific action that would be filed in a county court. Filing a Chapter 7 bankruptcy would give the mortgage lender the right to file the foreclosure after the bankruptcy case is closed, unless you reaffirm the mortgage debt with the lender.


Do you have to declare bankruptcy if you default on your mortgage?

No. If you default on your mortgage the lender will take possession of the property by foreclosure. Whether you file bankruptcy is an unrelated issue.No. If you default on your mortgage the lender will take possession of the property by foreclosure. Whether you file bankruptcy is an unrelated issue.No. If you default on your mortgage the lender will take possession of the property by foreclosure. Whether you file bankruptcy is an unrelated issue.No. If you default on your mortgage the lender will take possession of the property by foreclosure. Whether you file bankruptcy is an unrelated issue.


Who is the saint that protect homes from foreclosure?

Saint Bankruptcy


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Yes, temporarily. Filing for bankruptcy protects your from collection actions taken by your creditors, including foreclosure during the proceedings.


Will foreclosure hit credit report after it was discharged at chapter 7 bankruptcy?

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Is bankruptcy better when paying off bills due to a foreclosure?

Bankruptcy should only be a last resort when someone is faced with debt and a foreclosure. Bankruptcy always reflects on someone's records, even when they stumble on new financial opportunities.


Can you file a bankruptcy to keep from paying definciency on a foreclosure?

Yes.


Is it better or worse for your credit to let the bank foreclose on a mortgage of a second property while facing bankruptcy?

A foreclosure or bankruptcy is never good for your credit, this is something you'd be better off discussing with an attorney. You can avoid foreclosure by filing bankruptcy.


Should one declare bankruptcy before foreclosure proceedings start?

Generally, yes. It will delay the foreclosure and may give you time to find another place. It may make it possible to avoid foreclosure. You should talk to a bankruptcy lawyer in your state, since each state's bankruptcy case law is a little different, and some state laws work better with bankruptcy than others.


Do you have to declare bankruptcy if you have a foreclosure?

No. But, it may be in your favor to do both. Check with a lawyer.


Can filing for bankruptcy stop foreclosure?

Generally speaking, filing for bankruptcy protection temporarily halts ALL collection actions for all creditors, including foreclosures.


Is there a time limit for banks to foreclose on your home after filing bankruptcy been discharged?

The bankruptcy law does not set a time limit for banks to foreclose on your home after filing bankruptcy. In fact, banks are prevented from foreclosing or continuing a foreclosure already in process upon the filing of a bankruptcy without first obtaining an order from the bankruptcy court allowing it to foreclose or continue a foreclosure already commenced.


Can income received from a teacher retirement fund be garnished in foreclosure or bankruptcy?

Yes


Can I do a Bankruptcy and foreclosure with a second mortgage at the same time?

YOU don't evcer do a foreclosure on what you own. the bank does. Bankrutpcy overrides foreclosure and in fact will essentially delay it while the property is sold in the BK process.


When we file the Motion to reinstate does this stop foreclosure process?

Once this motion is recorded it should stop the foreclosure process. Actually, once the bankruptcy is filed, the foreclosure process should already be stopped.


Can you stop the property from going to foreclosure 2 days before it will be foreclosed on?

Yes, by paying the back payments. Also, filing bankruptcy prior to the foreclosure will normally put a hold on the foreclosure proceedings.


Is it 5 years after bankruptcy and foreclosure that you can buy a house?

2 years for an FHA loan


Can filing for bankruptcy remove a foreclosure from your credit report?

No, if property has been foreclosed upon the notation will remain on the credit report for the required amount of time of seven years from date of foreclosure. A bankruptcy remains on the credit report for ten years.