Bank Foreclosure Moratorium will buy some you some time but if your goal is to stay in your home you’ll need to save some cash or file a chapter 13

Foreclosures have slowed down this month across the nation not because people are staying current on their mortgages but because the banks are facing scrutiny over their foreclosure proceedings. This is really a big issue for states that use judicial foreclosure which California does not, but Californian’s are getting the benefit from the slow down as some banks have voluntarily stopped foreclosures for this month. I was going to file a chapter 7 case in which we surrendered the house last week a day before the date of sale at a trustee sale but a day before that the title company halted the foreclosure. It is now scheduled one month out which buys my client another month to live in his house for free and once he files he’ll get another 2-4 months before they can foreclose again. In his case he can’t afford his house and its 50% underwater so he had not intention of trying to keep it but it will allow him to save some money and be in a better position to move and get a fresh start once his bankruptcy case is filed and he gets a discharge. For people trying to save money to get caught up in their arrearages and still be able to file a chapter 7 this moratorium is a blessing, for others it just stalls the inevitable but gives them a place to stay for longer.