We offer Free Phone Consultations! Contact us to schedule yours.

Does Bankruptcy in New York Stop Foreclosure?

If you have fallen behind on your mortgage payments, you are not alone. Those struggling with financial issues before the pandemic may have found themselves in even more debt, as they suffered job losses and other challenges preventing them from catching up on these monthly payments. According to data from 2021, foreclosures rose by 67 percent from 2020, illustrating the pervasive nature of this issue. However, it’s important to recognize that you have options. Let’s look at how filing for bankruptcy can stop a foreclosure on your home in New York.

Understanding the Automatic Stay

One of the benefits of filing for bankruptcy is that the court will issue an order that stops all debt collection attempts, including those from mortgage lenders. Threats of foreclosure and foreclosure actions that have been started will stop.

How Chapter 13 Bankruptcy Can Help Stop Foreclosure

Filing for Chapter 13 bankruptcy relief in New York gives you five years to repay (interest-free) the arrears you owe on your mortgage. This repayment period begins as soon as you file for bankruptcy. The court allows you to resume making your regular monthly mortgage payment and a monthly payment to a bankruptcy trustee to repay the arrears. Additionally, Chapter 13 bankruptcy enables you to stop a property tax foreclosure sale, giving you five years to repay the property taxes you owe.

Explore Your Options With a Trusted Bankruptcy Attorney

Many people feel ashamed of their financial struggles, which may prevent them from seeking the help they need. While bankruptcy may still be viewed as a last resort—or even a source of shame—for those facing significant financial debt, the goal of this process is to help individuals regain control of their financial situation. Instead of continuing to suffer in silence, reach out to a compassionate New York bankruptcy lawyer to explore your debt relief options. Together, you can determine the most effective path forward to ensure you obtain the fresh start you deserve.


Call Grady BK, PLLC, today at (315) 299-9005 to explore your debt-relief options with an experienced and compassionate New York bankruptcy attorney.