Can Bankruptcy Stop a Foreclosure in New Mexico? Attorney Jason Cline Explains
Can Bankruptcy Stop a Foreclosure in New Mexico? Attorney Jason Cline Explains
How Bankruptcy Helps Homeowners Facing Foreclosure
Foreclosure is an incredibly difficult process for any family. When a lender moves to take someone’s home, fear and uncertainty naturally follow. According to Jason Cline, bankruptcy offers real relief and a path forward for those who want to save their homes.
How Filing Bankruptcy Stops the Foreclosure Process
For homeowners who are already in foreclosure, filing bankruptcy immediately stops all legal action. This protection is called the automatic stay—a powerful tool that freezes foreclosure proceedings, lawsuits, garnishments, and other collection efforts the moment a bankruptcy case is filed.
In a Chapter 13 bankruptcy, missed mortgage payments, known as arrears, can be rolled into a three- to five-year repayment plan. This plan allows homeowners to catch up on what they owe while staying current on future mortgage payments.For homeowners who are already in foreclosure, filing bankruptcy immediately stops all legal action. This protection is called the automatic stay—a powerful tool that freezes foreclosure proceedings, lawsuits, garnishments, and other collection efforts the moment a bankruptcy case is filed.
How the Automatic Stay Works in Bankruptcy
The automatic stay is one of the strongest protections available under bankruptcy law. Once the case is filed, it prevents creditors from collecting or proceeding with foreclosure, repossession, or garnishment.
In a Chapter 7 case, the automatic stay lasts about three to four months. In a Chapter 13 case, it can last for up to five years—the duration of the repayment plan—providing long-term protection for homeowners.
Immediate Relief After Filing
The automatic stay takes effect the instant the bankruptcy case is filed. Even if a home is scheduled for auction, filing before the sale can stop it immediately. If a foreclosure sale does occur after the case is filed, it can be reversed because the stay was already in place. This quick response gives families critical time and relief to stabilize their situation.
Using Empathy to Help Clients Through Financial Stress
Attorney Cline emphasizes that his approach to bankruptcy law is rooted in empathy and understanding. Many homeowners who come to him are overwhelmed and disorganized due to the stress of foreclosure. His role is to help them get clarity—reviewing foreclosure timelines, identifying key dates, explaining payment plans, and creating a clear path to save their home.
His goal is not only to handle the legal side but also to help clients regain peace of mind during an emotionally draining time.
Common Myths About Losing Property in Bankruptcy
One of the biggest misconceptions about bankruptcy is that filing means losing everything. Jason Cline explains that in 99% of cases, clients keep all their property thanks to bankruptcy exemptions.
These exemptions vary by state but often protect substantial assets:
- Up to $150,000 per person ($300,000 per couple) in home equity
- Up to $10,000 per person ($20,000 per couple) in vehicle equity
- A wild card exemption of up to $15,000 per person for other assets
- Full protection for household goods, jewelry, and personal belongings
With careful planning, most clients can protect their property while resolving their debt.
When Chapter 13 is the Better Option
For homeowners trying to save their homes, Chapter 13 is almost always the better option. While Chapter 7 provides temporary relief from foreclosure for a few months, Chapter 13 allows homeowners to repay missed mortgage payments over time and permanently halt foreclosure.
This structured plan ensures lenders must accept payments and helps homeowners rebuild stability.
Why Waiting Too Long Can Be Risky
Delaying bankruptcy can severely limit options. In New Mexico, foreclosure happens in two stages: a court case followed by a public auction. Once the auction takes place and the property is sold, there’s only a short window before the court confirms the sale. Filing bankruptcy after that confirmation is often too late to save the home.
Jason Cline urges homeowners not to wait until the last minute—every day counts.
What Homeowners Should Do First
For anyone unsure whether bankruptcy is right for them, Jason advises taking the first step: schedule a free consultation. Understanding all available options—whether negotiating with the lender or filing for bankruptcy—can make all the difference. There’s no pressure to file, but knowledge empowers homeowners to make informed decisions.
Talk to an Experienced Bankruptcy Attorney
If you’re a homeowner in New Mexico worried about losing your home, bankruptcy may offer the protection you need. Attorney Jason Cline provides free consultations to help residents understand their rights and options.
Visit attorneyjasoncline.com to schedule a consultation. You don’t have to face financial hardship alone—there’s always a way forward.
