How to Delay a Sheriff’s Sale
When your property has been foreclosed on, either by a bank or due to a judgment creditor, the property is ultimately put on a sheriff sale list. This is done by the sheriff’s department of the county where the home is located. At the sheriff’s sale, the property may be sold for a fraction of its value to cover the cost of the judgment against you. You lose not only your home but also any equity that you have in the property. In addition, you may end up with a judgment against you due to any junior lienholders.
So how can you avoid this? If you have already gotten to the point of a sheriff’s sale, is there anything you can do to stop the sale? How can you delay a sheriff’s sale in order to buy yourself more time to find a solution?
1. Filing Bankruptcy
Filing either a Chapter 7 or Chapter 13 Bankruptcy is one approach to stopping a sheriff’s sale. Filing for bankruptcy, even on the eve of the sale, will stop the sale, take your house off the list, and provide time for you to approach a federal bankruptcy trustee with a reorganization plan or numbers justifying why some of your debt should be discharged. Bankruptcy is very harmful to your credit, but if you have already suffered a foreclosure, the damage may not be much worse than what you have already suffered. Bankruptcy allows you time to reorganize, but in Chapter 13, you will still have to pay back all of the money that is owed. Chapter 7 bankruptcy depends on a number of factors and is obviously preferable if you are eligible.
2. Delay the Sale due to Procedural Missteps
If you can show that there were procedural mistakes in the case in which the judgment was entered, or if you are able to open or strike the judgment, you may be able to delay the sheriff’s sale. This is a rare way to proceed, but if you believe you have procedural default and can show it to a judge, the judge may order a delay in the sheriff’s sale while the procedural default is remedied.
3. Seek a Loan Modification or Short-Term Loan
In most cases, at the point of a sheriff’s sale, it is too late to talk to a bank about how to find a loan. But there are lenders who will make high interest loans to help you save a property. In many cases, these loans come with conditions, points, high interest and are not financially preferred. If they are your only option, they can help you save a property that you have equity in or buy you time to cash out.
4. Selling the Property Quickly May Avoid the Loss of Equity
If the sheriff’s sale is coming up, you may not have time to list the property with a realtor and wait for it to be sold. There are investors and cash buyers as well as wholesalers who are willing to purchase homes and give you value for your equity. In some cases, these purchasers are willing to purchase leasebacks where they buy the house, cash out the equity and then give you a lease for a period of time so that you can either find a new place to live or become a renter at the house. Again, although no one prefers to lose their home and become a renter, if this allows you to avoid the disaster of a sheriff’s sale and recover some of your equity, it is a great outcome.
CONCLUSION – Call Cornerstone Law Firm today.
If you are facing a sheriff’s sale for your home or property, even if you believe that you don’t have the funds to save your house, it is important that you talk to a lawyer. Call Cornerstone Law Firm and set up a consultation to discuss how we can help you get a solution regarding your property.