Bankruptcy/Foreclosure

[ifitdoesnotfit]

What is the name of your state? New Jersey
My sister has been in a (diagnosed) severe depression for years.. lately it's gotten much worse. As a result she is unable to get a job and her house has gone into foreclosure. The mrtg. holder has said that they will put it up for sheriff's sale at the beginning of the year (2 mos or so). I have a couple questions:
1. Will filing for bankruptcy do anything to delay the foreclosure? (she has other outstanding debts as well and very bad credit)
2. If she were to get herself together enough to sell the house she could gain a $100,000 profit. Would filing bankruptcy (in order to alleviate the other debts and retain a decent amount to live off of while she gets medical help)affect the gains she may make in selling the property?
3. Will she get notice of when (exactly) the house will go up for sheriff's sale?
4. Can she sell a house even if it is in foreclosure?
Thank you for any advice.

[ihatearizona]

You might be able to avoid the bankruptcy filing alltogether if you could get the mortgage company to agree to let her sell the home instead of foreclosing.

If she's going to have $100,000 in equity that will be a problem if she files for bankruptcy.

[ifitdoesnotfit]

Let's just say that my sister wants to keep the house... she is getting letters from attorneys saying they can stop the foreclosure through bankruptcy. How long does that take? What is the process? Assuming bankruptcy stalls the foreclosure, how long would she have before she has to start paying the mortgage again?.. and what about the debt that she already owes from the past few unpaid mortgage payments?
Thanks for your reply

[ihatearizona]

The attorney's would be talking about a Chapter 13 (Repayment) bankruptcy.
If your sister doesn't have any income this would not be an option.

Chapter 7 will temporarily stop the foreclosure proceedings but the court will grant relief from the stay and the proceedings will continue.

[ifitdoesnotfit]

Thank you again for your reply
I guess my biggest question is
do you have any suggestions on what she should do? Here's my thought.... if she sells the house, she has $100,000 but even that doesn't go far when she is unable to work right now and medical attention (from what i hear) is a lengthy process. Is there any way that she can sell the house and clean up her credit as well (without having to use the $100,00 that she will definitely need to live on)? She's 45 years old and her future looks pretty bleak in my opinion. I'd hate to see her sell the house and then never get another one because her credit has gone to absolute hell. A counselor suggested that she needs to be on disability.. does this do anything to help with relieving past debts? Hope my question is clear... just hate to see her loose everything and not have a future.

[ihatearizona]

The problem is going to be that she will have $100,000 in her bank account.
She should be able to negotiate with her other creditors to bring the balances to some sort of agreed lump sum payment in lieu of paying the full amount. She might also be able to get the creditor to agree to remove derogitory marks they have placed on her credit if she pays them off. I wouldn't expect to receive both though.

Go over to [url]http://www.creditboards.com[/url]
They have a lot of information that should be helpful for your situation.