I WAS INJURED AT WORK AND AS A RESULT, THE MORTGAGE COMPANY IS FORCLOSING. I AM EXPECTING A SETTLEMENT IN A COUPLE OF MONTHS. CAN YOU HELP ME?
A recent study has shown that one of the major reasons people get into debt is because of medical bills and illness. Also, unemployment and divorce lead to financial problems.
The worst thing you can do is to wait for the workers compensation settlement to wait to file bankruptcy, since whenever you have a personal injury claim, there can be a time delay if and when you receive your settlement and it may not save you from the foreclosure because you may not get enough to reinstate the mortgage and/or you may not get the settlement until after the foreclosure is finalized.
Once you file a bankruptcy petition, it will create a stay which will stop the foreclosure. Any bankruptcy will create a stay except in certain limited circumstances regarding prior bankruptcy filings which the lawyer will explain to you.
Also, when you file a bankruptcy, the bankruptcy code fully exempts a worker’s compensation claim and there is a large exemption of $23,675 for a personal injury claim plus whatever wildcard exemption you have left over from 11 USC 522 (d)(5).
In the present situation, Mr. Taieb would advise you to file a Chapter 13 to stop the foreclosure and do a reorganization to try to save the home and seek to eliminate unsecured debt.
Thus, whenever you are in foreclosure and have a worker’s compensation claim or personal injury claim, NEVER delay filing bankruptcy unless you have the check from the settlement and it will cover the exact amount of the delinquency. If you don’t have enough to catch up and you have no GUARANTEE when the settlement check will arrive, then make sure to file bankruptcy since timing is everything and if you make a mistake, you can lose your home.
If you have any questions concerning this matter or any other matter contact TAIEBLAW at 856-235-4994 and schedule a FREE initial consultation.
Steven N. Taieb, Esq. has been a South Jersey Bankruptcy Attorney for over 34 years and is board certified in consumer bankruptcy law by The American Board of Certification which is accredited by The American Bar Association.