If you have been considering bankruptcy, you’re probably not in the most peaceful mindset. You’re probably swimming in debt, getting bills constantly in the mail and receiving constant, harassing telephone calls to your cellphone, to your home phone and even at work. In other words, you’re feeling overwhelmed in more ways than one and you just want it to stop.
If you own your home, the chance of losing your home in your bankruptcy process can be even more frightening. Indeed, we work so hard for our family homes and — to think that we could lose them and their accumulated equity in one fell swoop — is terrifying. Fortunately, if you’re a homeowner, you might not be in danger of losing your home.
In most cases, a bankruptcy will not result in the loss of home. However, if you file for Chapter 7, you’ll have less of a chance of keeping your home. If you file for Chapter 13, you’ll have more of a chance of keeping your home. In both cases, there are thresholds regarding how much equity you’ll be permitted to keep.
Homeowners will be in danger of losing their residences if they’re unable to afford their mortgages. That said, through the resolution of the homeowners’ other debts in bankruptcy, it could free up sufficient capital to meet the payment requirements of the mortgage creditors.
Are you concerned about keeping or needing to sell your home as a result of your bankruptcy? You may want to ask an experienced bankruptcy for his or her opinion about whether or not you’re likely to keep your home.