Will I Lose My Home If I Declare Bankruptcy?
If you recently have decided that you need to declare bankruptcy, you may be wondering if you are going to lose your house. Well, there is no definite answer, you may or may not, depending on some specific factors. If there is currently no equity in the house, meaning that you owe more on the house than the price at the time of purchase, then the chapter 7 trustee will transfer the house over to you as long as you still pay the mortgage. However you must keep in mind that by declaring bankruptcy, you are not relieved of a secured debt such as a mortgage. So if you do not continue to pay your mortgage, the lender still has the right to foreclose on the property.
If you do have equity in the home, then the situation may be a little bit different. You need to find out if the exemptions that you are allowed by your state, exceed or are equal to the equity in the home. Exemptions are the things of value that you own that cannot be claimed by creditors. If the equity happens to be exempt, then you are able to keep the house. If there is not enough allowed room in regard to the amount of equity in your property, then you should consider filing for bankruptcy under Chapter 13, as this may allow you to keep your house if you declare bankruptcy.
People all across America are losing their homes each and every day. If you are able to keep your home, decide if you can really afford it. If you are already declaring bankruptcy, and are struggling to get by, you may want to consider your options in regard to selling the house, or allowing it to go into foreclosure. Talk to a real estate attorney or your mortgage consultant through your lender to view and weigh your options. You want to be aware of all the possibilities that may be presented to you before you make any choices.
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Am I correct in understanding that bankruptcy legislation is a state by state affair in America?
Are they’re any caveates that bankruptcy puts on your home? Lets say I have negative equity this year but next year my house doubles in value. Will they sell my house then?