How To Prevent Foreclosure On Your House In Memphis TN

When a lot of people think of the term foreclosure, they think it’s the kind of thing that will never happen to them that is, until it does. And just like that, when you’re trying to sell your house, you have to deal with an impending or ongoing foreclosure to muddy up the waters. It doesn’t take much to change the way the winds blow financially, and all of a sudden you find yourself trying to sell a house in foreclosure in Memphis. It might feel like an impossible task.

However, if you want to sell your house without these financial burdens, there are steps you can take to hold off foreclosure proceedings, many of which allow you to maintain control over the home. Whether you file for bankruptcy, apply for a loan modification, use the legal system, or sell your house as-is for cash to a real estate investor like Fair Cash Deal, it’s possible to delay or even stop foreclosure, even if you’re right up against the deadline. Here’s how to prevent foreclosure on your house in Memphis, Tennessee. 

a petition to file for bankruptcy to prevent foreclosure

Option 1: File for Bankruptcy

Is the clock ticking and you want to stop the foreclosure process before the lender officially starts it on your Memphis house? Declare bankruptcy. This will stop any foreclosure proceedings in their tracks regardless of any deadlines. This is due to an automatic stay that goes into effect by law. It prohibits a lender from collecting on any debt while the bankruptcy process plays out. That buys you some time to figure out your next steps. 

Now, it is possible that your lender can file a motion for relief during this stay. The court may or may not grant this, allowing them to continue foreclosure. However, even if they do, it delays the foreclosure from happening for at least a month, which will give you a little bit more time to figure out what to do next. 

While declaring bankruptcy might sound like an obvious solution, there are significant drawbacks you need to consider. This isn’t a “get out of jail free” card. By declaring bankruptcy, your credit score is going to take a big hit, which will then make it very hard for you to get loans or credit in the near future. You also aren’t allowed to file bankruptcy again for a very long time, so you really don’t want to use this option too early. Bankruptcy also allows creditors to attempt different collection actions against you, including wage garnishment. 

While we’re here, it’s important to know the difference between Chapter 13 bankruptcy and Chapter 7 bankruptcy. If you want to try to keep your Memphis house, you’re going to want to go for Chapter 13 bankruptcy. If your goal is more to buy some time and you’re not as concerned with keeping the house, a Chapter 7 bankruptcy could make more sense for you. 

The content is for informational purposes only, you should not construe any such information or other material as legal, tax, investment, financial, or other advice.

Option 2: Apply for a Loan Modification

Instead of pushing back against your lender, you can also try to find a way to work with them, You can apply for a loan modification or some other kind of foreclosure avoidance process they would agree to. This can help slow things down and give you a chance to get back on track without going down the bankruptcy road.

Basically, you’re asking your lender to figure out new terms for you on the loan that make it easier to pay. A loan modification can delay foreclosure proceedings because lenders are often restricted from pursuing foreclosure while a loss-mitigation application is pending. If your modification is approved, the foreclosure process will be over and you’ll be able to start fresh with a new payment plan. This can often be seen as an ideal scenario for those who want to keep their house and get back on track.

Of course, your lender has to want to do a loan modification on your Memphis house. And even if they agree to one, you still need to make payments under the new schedule. If you don’t make these payments on time, the foreclosure process could start up right back up again and you’ll be back to square one.

Option 3: File a Lawsuit Against Your Lender

If your lender is attempting to foreclose on your property using a nonjudicial process, you might be able to stop them by filing a lawsuit against them in a Memphis court. If the foreclosure is already judicial, this tactic probably won’t work because a judge will have already ruled on the case and there’s not really much in the way of getting around that. 

In order to delay or stop the foreclosure, you’ll need to prove that the lender shouldn’t be allowed to move forward because of extenuating circumstances that you’re dealing with. These circumstances can be many things. They include the lender not acting in accordance with Tennessee’s mediation requirements, not being able to prove it owns the promissory note on your property, violating the Homeowner Bill of Rights in the state of Tennessee, not following all the requirements of the foreclosure process, or making any kind of major error that you’re able to prove.

One thing to consider. Before you file a lawsuit, you should remember it’s very possible you won’t win. If you lose, all you will have accomplished is a slight delay, not to mention all the money you spent on legal fees. And if your case is considered frivolous by a judge, you could end up paying court fees and for the lender’s attorney fees. So don’t make this choice lightly.

Option 4: Contact a Memphis Attorney

If you want to exhaust all your options in delaying the foreclosure, it might be worth it to reach out to a local attorney who deals in foreclosures. Make sure you meet with one who offers a no-fee consultation in case you don’t want to move forward. You want to look for an attorney who specializes in foreclosure, bankruptcy, or other financial concerns. They should be able to provide you with examples and experiences similar to yours. And if you like what they have to say about your situation and think they can offer a solution, you can hire them for whatever their fees are. 

You can also speak with a HUD-approved housing counselor, who may be able to provide you with information and assistance that can help you avoid foreclosure on your Memphis house.

a house in foreclosure for sale as-is

Option 5: Sell Your Memphis House As-Is for Cash

If the clock is ticking and you find yourself out of options on how to avoid foreclosure, one of the best options is to sell your house or property as-is to a real estate investor like Fair Cash Deal. Even if foreclosure is coming, so long as the bank doesn’t own your Memphis house, we can make you a cash offer and take it off your hands before it’s too late. 

The best part is that you don’t need to do anything to the property or worry about the financial situation. We buy houses “as-is”, which means we buy it in any condition, whether that’s physical damage or financial problems. 

Just contact us with all the details about your house in foreclosure in Memphis, TN. We’ll assess the property and then make you a fair offer, paying you in cash if you decide to accept. If you approve, you set the conditions of closing, which can often be within a few days. You won’t need to make any repairs or deal with the financial situation any further. You can walk away from the house with cash in your hand and let us deal with the foreclosure situation.

Contact us today to get started and find out how to sell your house fast in Memphis for cash before foreclosure.

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