If you’re facing foreclosure, it’s easy to feel like you’ve run out of options. The stress, the fear, and the pressure can be overwhelming. At Mitchell Property Group, we’ve helped hundreds of homeowners navigate this tough spot, most of the time, helping them avoid foreclosure. Over the last 25 years, we’ve worked closely with families throughout Amarillo and surrounding areas who were on the brink of losing their homes.
One of the most common questions we hear is, “Should I file for bankruptcy to avoid foreclosure?”
Let’s dive into this complicated topic. First and foremost, we’re not bankruptcy attorneys, and this blog is not intended to be legal advice. Always consult a licensed attorney before making any decisions about bankruptcy. That said, based on our extensive experience helping people sell houses and avoid foreclosure, we’ve learned a few things that might help you understand when bankruptcy may—or may not—make sense.
When Bankruptcy Might Be Worth Considering
There are situations where bankruptcy can give a homeowner the breathing room they need to get back on their feet. For example, imagine this scenario:
You’re a doctor or other professional with a solid income, but you suffered an injury or medical condition that left you unable to work for the last year. During that time, your finances fell apart. You missed mortgage payments, and now the bank is threatening foreclosure.
The good news is, you’re healed and ready to return to work. You know you can afford your mortgage going forward, but the lender refuses to work with you to restructure your missed payments. In this case, filing bankruptcy in Amarillo might force the lender to avoid foreclosure proceedings and allow you to catch up over time.
In this kind of temporary financial setback, bankruptcy isn’t a failure—it’s a tool. It buys you time to stabilize and protect your home from foreclosure. It can force the bank to cooperate when they otherwise wouldn’t.
When Bankruptcy May Be a Bad Idea
On the other hand, bankruptcy isn’t a magic wand. If your financial issues are not temporary, filing bankruptcy could end up hurting more than it helps.
Let’s say you’ve gone through a divorce and lost half your household income. Your mortgage payment is simply unaffordable now, no matter what. You’ve already tried to cut expenses, but the math just doesn’t work. Filing for bankruptcy might delay foreclosure, but it won’t solve the underlying problem—your income can’t support your current mortgage.
In that case, you risk ending up with both a foreclosure and a bankruptcy on your record. That’s a heavy burden to carry into the future, and it could limit your options for years to come.
The Sooner You Take Action, the Better Your Outcome
One thing we’ve seen time and time again: the people who call us early in the process have more options, less stress, and usually walk away with more money in their pockets.
Whether you’re seriously considering bankruptcy in Amarillo or just exploring your options to avoid foreclosure, don’t wait. When you delay, you lose valuable time and leverage. You may end up with fewer choices and more financial damage than necessary.
That’s why at Mitchell Property Group, we always encourage homeowners to call us sooner rather than later. Even if you don’t end up selling your house to us, we can help you explore all your options and even connect you with a good bankruptcy attorney if needed.
What Are Your Options?
If you’re facing foreclosure, read another blog we have on Flirting with Foreclosure, or here are three common routes to consider:
- File for Bankruptcy: As explained above, this is sometimes a smart option if your financial hardship is temporary and you’re confident about your future income. Consult with a qualified bankruptcy attorney in Amarillo to see if this is right for you.
- Sell Your House Fast: If you realize you simply can’t afford the home anymore, selling your house may be your best bet. We buy homes in any condition and can close quickly—often in a matter of days. This can help you avoid foreclosure, protect your credit, and walk away with some cash in your pocket.
- Loan Modification or Forbearance: In some cases, banks will work with you to restructure your loan. But we’ve seen many homeowners frustrated after months of trying to negotiate with no results. If you’ve already tried this and it hasn’t worked, don’t wait until it’s too late.
Final Thoughts
Bankruptcy isn’t always a bad thing—but it’s not always the solution either. Whether it’s the right move for you depends on your long-term financial picture. If you’re unsure what to do next, don’t try to go it alone. Talk to an attorney, speak with real estate professionals like us, and take action as soon as possible.
At Mitchell Property Group, we specialize in helping people sell houses quickly and avoid foreclosure in the Amarillo area. If you’re feeling overwhelmed or don’t know where to turn, give us a call. We’ve helped hundreds of people just like you, and we’re happy to offer guidance—even if selling isn’t the right choice.
Call us today at 806-359-7653. Let’s talk through your options and help you move forward.