Can Bankruptcy Stop Foreclosure?

No, Bankruptcy will not stop foreclosure but it will postpone it.  Filing bankruptcy will hault all collections while the bankruptcy is in process but once its discharged normal foreclosure rules apply to your state.  Please check you state to find out the laws and time frame.  There is also a situation when a lender might file a dismissal for stay of foreclosure.  Usually this is when there is no equity in the property which means the borrowers interest is zero.  Check with an attorney in your state for specific guidelines. 

Foreclosure Definition

Legal proceeding initiated by a Lender to take possession of property securing a defaulted loan. Some states allow lenders to reclaim property by simply declaring the borrower has defaulted, a process known as strict foreclosure. Most states, though, require lenders to file a foreclosure suit and obtain a judgment before seizing and auctioning off a borrower's property. Proceeds from a foreclosure sale are applied first to pay off the mortgage debt and foreclosure expenses, with the remainder, if any, going to the borrower. A borrower in default has the legal right, in most states, to redeem his property, called right of redemption, by paying the lender the balance of the outstanding debt, plus out-of-pocket expenses.

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