A question that many people ask is if I will lose my house if I file bankruptcy. The short answer is no. If you are facing financial difficulties, the last thing you want to do is drop the idea of filing bankruptcy as it will more than likely mean a long and expensive court battle. If you have fallen behind in your payments, you may not qualify for a loan modification. If this is the case, you will need to come up with the money to pay the modified payment and this may mean selling your home.
Chapter 13 and Chapter 7 Bankruptcy are two different types of bankruptcy that are considered valid. Filing a petition to the bankruptcy court will entitle you to a hearing to determine whether or not you can meet the guidelines to get out of debt. During this hearing, a Cain & Herren bankruptcy lawyer will review your financial information to determine if you are eligible for a chapter 13 bankruptcy repayment plan. Chapter 13 is considered a last resort for many people who are having trouble paying their mortgages. They may not meet the standard to receive a chapter 13 discharge.
Some of the criteria required by the bankruptcy court to discharge your debts include: if you have become bankrupt due to circumstances beyond your control, if your income has dropped significantly, and if you cannot reasonably cover the monthly payments on your unsecured debts. The bankruptcy exemptions will also include: creditors who are owed more than ten thousand dollars by the debtor, if you have filed for bankruptcy within the past five years, if you have not been employed in business for at least one year, and if you own real estate or property that is worth more than five hundred dollars. These exemptions will not apply to regular household bills, personal loans, student loans, child support, IRS tax debts, and child custody and support payments that are made to other family members.
There are some exclusions to the chapter 7 bankruptcy law, which will allow you to retain possession of your home. One of these exclusions is called the “exclusivity period”. If the creditor fails to follow this law and fails to repay you during the exclusivity period, then they will lose their right to collect any monies that you owe them. This will prevent your bankruptcy case from being transferred into another state and will prevent your creditors from attempting to collect any debts that you still have after the exclusivity period.
It is important to be aware of the bankruptcy exemptions so that you will not make a mistake when filing your bankruptcy petition. You will also want to consider the effect of any exemptions that you may have. It is possible to receive a discharge from some creditors while attempting to repay a loan or debt through bankruptcy, but this must be approved by the bankruptcy court. There are many different types of discharge that may be available, and you will want to understand each one so that you will not be subjected to further punishment after your bankruptcy case has been set for trial.
Two of the most common bankruptcy exemptions are unsecured debt and exempt equity. Unsecured debt will include things such as credit card debt and medical bills. Exempt equity involves your home. Both of these types of debt cannot be discharged by chapter 13. A discharged debtor can still be in possession of their home if they are able to prove that they are eligible for a discharge. This will be determined by the bankruptcy court.
Cain & Herren, ALC
2141 W Vineyard St, Wailuku,
HI 96793, United States