Bankruptcy is a scary procedure to undergo, and some wonder if they should simply allow a mortgage foreclosure to take place instead. Few people realize how difficult the choice is to make, or recognize that the decision is not an either/or one. An act of foreclosure can occur when the mortgage lender does not receive the monthly payments they are entitled to.

The reason a foreclosure occurs is because a mortgage lender isn't paid their monthly mortgage payments. Stopping the action can only be done by paying the lender. A mortgage loan is sort of like a car loan and if a person does not pay his car payment, he will lose the car through repossession. Therefore the same result will apply to a person who does not pay his mortgage payments - he will lose his home through foreclosure!

If a person's debt is so bad that they cannot pay their debts, then they sometimes must file bankruptcy. This action stops all civil proceedings against the debtor while the debtor is in bankruptcy. A foreclosure can be halted through these means because lender is required to cease all their legal actions against the debtor.

Once they are granted such relief, they will continue with their legal actions against the home buyer. Bankruptcy does not allow you to keep a home that is not paid for to the mortgage lender, and it will not stop foreclosure. Bankruptcy will slow the action, but it will not prevent it.

Occasionally, however, foreclosure is prevented through bankruptcy, as the latter gives person additional time in which to pay the lender and usually makes the paying easier. As bankruptcy makes a mortgage lender temporarily cease a foreclosure action, a debtor has additional time to raise money to pay the lender. The debtor may also have have several of their other debts eliminated due to bankruptcy, so they are able to have additional money available to pay their mortgage. In terms of a chapter 13 bankruptcy, the courts will dictate that the payment of the overdue mortgage needs to be paid through several payments, which will further give the debtor time to pay the lender off.

Of course, there is a good chance that a debtor might not actually be able to file for bankruptcy, as eligibility is an issue, and even if they do qualify, there are legal fees that need to be paid. For some, they may find that the exorbitant fees they are asked to pay are even higher than the payments they were behind on. Anyone considering bankruptcy to prevent foreclosure should discuss it with a lawyer. Bankruptcy is a complicated legal process that should not be handled by yourself alone. The scope of this article is to give you basic information, and if you are wanting more detailed information, you need to speak to a lawyer who is actually licensed in your home region.