The thought of losing your home to foreclosure in Northeast, Central, or Southeast Arkansas is terrifying. In a moment of high stress, it is easy to make costly mistakes that eliminate your options.
Crawley Law Firm specializes in Foreclosure Defense and utilizes Chapter 13 to save homes. We have identified seven critical errors homeowners make and, more importantly, the proven legal fix for each one.
Mistake 1: Why is ignoring the foreclosure notice the biggest error?
This is the most common and damaging mistake. Ignoring the official complaint ensures a default judgment against you, rapidly accelerating the foreclosure process and eliminating valuable defenses.
Solution/Fix: Contact an experienced foreclosure defense attorney immediately upon receiving the official lawsuit. Do not wait until a sale date is set. Your attorney can file a legal Answer to the Complaint, which is the first step in mounting a formal defense.
Mistake 2: Why is liquidating retirement accounts to make a payment a bad idea?
Homeowners often panic and cash out 401(k)s or IRAs to make a single mortgage payment. You pay significant taxes and penalties, only solving the immediate problem without a safety net if you miss the next payment.
Solution/Fix: Stop liquidating protected assets. In bankruptcy, retirement accounts are typically exempt (protected) from creditors. Consult with Crawley Law Firm to see if Chapter 13 can consolidate your missed payments into a manageable long-term plan without sacrificing your future retirement.
Mistake 3: Why is signing a deed in lieu of foreclosure or a short sale agreement without legal review risky?
These options can expose you to deficiencies (the remaining debt after the home is sold) or other unexpected costs. They may be reported on your credit as a non-payment, which is nearly as damaging as a full foreclosure.
Solution/Fix: Never sign property documents without having an attorney review them. Chapter 13 bankruptcy automatically provides a better, court-protected option to cure the missed payments and keep your home.
Mistake 4: Why is believing that foreclosure is unstoppable a misconception?
Many clients simply give up when they receive the final notice. This is a myth, even if a sale date has been scheduled. The legal process provides powerful defenses and protective measures.
Solution/Fix: File for Chapter 13 bankruptcy. The moment your petition is filed with the court, the Automatic Stay is activated, instantly halting the foreclosure sale, regardless of how close the scheduled date is.
Mistake 5: Why is only communicating with the lender instead of pursuing all options a critical error?
The lender’s loss mitigation department is working for the bank’s interest, not yours. Relying only on a loan modification is a high-risk strategy that often leads to disappointment and missed deadlines.
Solution/Fix: Keep loss mitigation open but simultaneously consult with Crawley Law Firm about a Chapter 13 plan. Chapter 13 gives you a guaranteed, court-mandated path to catch up on payments that is not subject to the bank’s approval.
Mistake 6: Why is waiting until the last week to seek legal help a dangerous gamble?
Filing any bankruptcy case, especially a complex Chapter 13 to stop foreclosure, requires compiling numerous financial documents. Waiting until the final days means the attorney must rush the filing, increasing the chance of errors.
Solution/Fix: Contact Crawley Law Firm the moment you receive the first warning letter. Early intervention provides the maximum amount of time to structure the perfect defense and ensure all paperwork is completed accurately.
Mistake 7: Why is not using the state’s geographic protection an oversight?
Arkansas law provides certain homestead exemptions, and attorneys with deep regional knowledge can leverage specific state and local rules to your advantage, maximizing your legal protection.
Solution/Fix: Choose a law firm with proven, deep experience in Arkansas. Crawley Law Firm leverages its expansive regional expertise to ensure your case is handled with precision and takes advantage of all available exemptions to protect your property.
The Only True Fix: Decisive Legal Intervention
Foreclosure is a serious legal process that homeowners often inadvertently complicate by attempting to negotiate alone or by waiting too long to act. The seven mistakes listed here—from ignoring initial notice to liquidating protected retirement funds—can all be avoided with decisive, early legal intervention. Crawley Law Firm specializes in Foreclosure Defense and leveraging the power of Chapter 13 to immediately stop a property sale. If you are a homeowner in Arkansas facing this crisis, do not attempt to fix a legal problem with simple communication; contact us today to secure the legal protection and structured solution you need to save your home.
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