The bank does not want to take title to the property, probably because of environmental, management or other liabilities. American Mortgage Debt Resolution, Inc. negotiates these workouts in all fifty states. Advantages of bankruptcy include the debtor's ability to stop foreclosure without creditor acceptance and encompassing more than just the mortgage debt with a single action. If bankruptcy emerges as our first recommendation your personal circumstances must be well suited for this option, in most cases bankruptcy comes as a last resort. In Chapter 7 all nonexempt assets are turned over to the bankruptcy trustee and debts discharged.
Exemptions vary by state.
In most cases the debtors possess so few assets that they may keep everything and have all of their debts wiped out completely. If a chapter 7 will not yield this result it may not be the best option. In Chapter 13 a plan outlines how the debtor will pay creditors over a three to five year period. Only a Chapter 13 can stop a creditor from foreclosing on a delinquent debtor over a period of years. Under a chapter 13 the court retains the right to scrutinize finances of the debtor for the life of the reorganization plan.