How to Protect Home from Bankruptcy?
Many individuals are concerned about the loss of their homes when they consider chapter 7 or chapter 13 bankruptcy. Some of them may face forfeiture; others may manage their mortgage well but do not want to lose their homes due to bankruptcy.
It relies on several variables, whether you can maintain your home in bankruptcy:
Filing for Chapter 7 or Chapter 13
If you file the quantity of equity in chapter 7 and file it for chapter 13, the number of home benefits available to you.
Future Home Equity
Chapter 7 ‘straight bankruptcy’ fixates on the present. It covers the debts that your bankruptcy attorney in Edmond, OK, is currently filing in the bankruptcy court for Chapter 7. Chapter 7 in particular, generally doesn't focus on new assets you buy after the filing date. For instance, the money you earn when you go to work the day after the filing is outside the jurisdiction of bankruptcy. Again, bankruptcy only looks for what you own on the filing date for most purposes.
This is also true with regard to your home. Chapter 7 fixes the amount of equity at the time of filing in the home. So, we look at the value of the home and the amount of debt against it. (The debt contains all valid domestic safety interests: mortgages, estate taxes, revenue tax liens, etc.)
But those factors that determine the value and the amount of your home equity change. They're constantly changing. The value of the house increases and falls on the market (but mostly). Everyday interest and each time you make a deposit, the debt on security interest changes. You would usually advance with the payment of domestic debts after the bankruptcy was filed and your economic house ordered. With home value generally rising and debt reduced in the years after bankruptcy was filed, most individuals are building equity at home.
Home and Chapter 13 Bankruptcy
In the bankruptcy of Chapter 13, you hold your belongings and pay off your debts (some fully or partly). You're not going to lose your house because you are keeping your property if you pay your mortgage.
Chapter 13 enables you to make up the default by means of your repayment scheme if you are behind in the payment of mortgages. Therefore, for individuals in danger of losing their homes, Chapter 13 is often a useful option.
Home and Chapter 7 Bankruptcy
The trustee of a bankruptcy attorney in Edmond, OK, will sell your non-exempt property and distribute the proceeds to creditors if you file for Chapter 7 bankruptcy.
Fortunately, bankruptcy law protects certain of your assets against the creditor's access by means of 'exemptions'. If your equity is exempt, it cannot be taken by the trustee. Save all loans and loans on the present market value of your home to determine how much equity you have in your home.
Contact Chris Mudd and Associates for a bankruptcy attorney in Edmond, OK.
** Disclaimer: This blog post does not constitute legal advice, nor does it create a client-attorney relationship.