Bankruptcy to stop sheriffs sale?

Hard to say not knowing the particulars. Is it just an issue of the payment doubling or do they owe more than the house is worth? Did they try a loan modification or did they do nothing and now expect a rabbit to be pulled out of the hat at the 11th hour? Time is of the essence in these situations and they appear to have squandered theirs. The only reason to file for bankruptcy is if they have a viable option to be able to keep the house. Otherwise, it doesn't make sense to declare bankruptcy to gain time to sell the house. If they file BK and don't figure anything out, they then have a foreclosure and a BK on their credit history. Sometimes there just isn't a solution.

is generally correct in the above assessment. My theory is don't use that bankruptcy card until you need it for something big. My definition for big is something in the excess of $10,000,000. But that's just me. Everybody has to calculate their own threshold. You only can use it once in seven years, so make it count!!

My ex and I were buying a huge place in Hayward Wis, and we had our home to also sell. The owner said she would do a land contract. We were to sign papers on it on a Friday. She called on Tuesday and then told us she was behind on payments and it was foreclosed on. She claimed bankruptcy the day she talked to us and said it would buy time, which we knew that wouldn't work. It is only a possibility if they started the bankrupt papers before being served with foreclosure. We ended up walking away from it. Less than one year later, the bank called me and offered it to me for $24K for the 40 acres, two houses and it was a 10,000 sq ft replica of a Scandinavion castle from the 13th century. President Ford did the ground breaking for it, was to be a Hobbiest Hall of Fame. So this was going to be my bed and breakfast with carriage drives. The owner wanted $94k for all of it. Her and her husband were just married and had started it, and we was killed, so she wanted out of it.
But once papers are served, the bankruptcy does not work. HOWEVER, another state may be different. I would check with the courthouse, or the owners need to be sure it works. Bill is right, what were these people waiting for before they did nothing till now.

I so agree. I dont understand why some people seem to think that it isnt going to happen. They live in denial and just assume at the magic hour they will be able to pull a rabbit out of their hats. I happen to know these folks and were just too proud to ask for help from me and i wouldnt of known about it if i hadnt looked in our local paper at sheriffs sales that were coming up. Sheesh...

Regina...did they have any equity to work with or were they upside down?

Upside down...

they can file a bankrupcty just to delay the proceedings for 30 days; in the meantime the court will ask for documentation to move forward with the bankrupcty-if they dont' provide the documents required, the bankrupcty will not go through, and this will give homeowners time to find another place and move...

Valerie