Can I keep my house if I file bankruptcy?

Can I keep my house if I file bankruptcy?

Sometimes when credit card and mortgage debts become overwhelming, a person can feel panicked. Lots of questions swirl through your mind like “How do I stop these creditors from calling me?” and “Can I keep my house if I file for bankruptcy?” It can be a struggle every month just to make minimum payments, and you may be tempted to let unopened bills pile up on the kitchen table. If this describes your situation, there is an option for a better future.

Bankruptcy can be a chance to make a fresh start.  That’s why bankruptcy laws were created.  When you’re struggling in vain with insurmountable debt, a knowledgeable bankruptcy attorney can guide you through a smooth, step-by-step process that reestablishes your financial footing.  Adam Law Group has helped countless clients begin again with a clean slate.  We’d be happy to answer your bankruptcy questions.  For a free initial consultation, call us at 904-329-7249.

Do I lose my house if I file bankruptcy?

Details about which bankruptcy lets you keep your house

Here’s the good news, in many instances you can keep your primary residence if you choose to do so. Whether you pursue a “liquidation” bankruptcy or a “debt reorganization” bankruptcy, you have choices and there are likely ways to hold onto your home. However, you will have to continue making mortgage payments, if any, after a bankruptcy is completed.

  • Chapter 7 Bankruptcy – This is sometimes called a liquidation bankruptcy.  Generally, you can keep the home you’re living in and your vehicles when filing Chapter 7 as long as there is not excess equity above governing Florida bankruptcy exemption statutes.  A Chapter 7 bankruptcy involves the liquidation of all of an individual’s non-exempt assets in order to satisfy the claims of creditors. The successful completion of a Chapter 7 bankruptcy will result in a discharge of your remaining debt, such as credit cards, personal loans, medical bills, etc. Once discharged, you cannot be compelled to repay the debts and no action can be taken to collect the debt. 
  • Chapter 13 Bankruptcy is a reorganization plan which allows you to restructure and pay off your debts over a period of three (3) to five (5) years. Chapter 13 has been called the “wage earners” bankruptcy because you need to have a steady income to qualify.  Chapter 13 may be right for you if you are in a situation where you wish to keep valuable assets — like a home — and you are earning enough money to repay some of these debts over a period of time.  If you are a homeowner whose debts have caused you to fall behind on mortgage payments, Chapter 13 will allow you to make up this amount over time so you can save your home from foreclosure. Filing Chapter 13 can stop foreclosure proceedings with its automatic stay provision, even if a foreclosure action has already been filed. However, you do have to make all mortgage payments that come due during your plan, and do so on time.

Bankruptcy benefits

  1. All creditor phone calls stop. After filing your case, the automatic stay protection is immediately invoked. This means that all of those intimidating phone calls from creditors will cease. The automatic stay will stop all further collection activities against you throughout the bankruptcy process. Once invoked, it is against the law for creditors to continue sending you letters or making harassing phone calls.
  2. Bankruptcy may improve your credit. It’s a widely held misconception that bankruptcy will ruin your credit forever. Bankruptcy laws were designed to help consumers return to creditworthiness. How the consumer uses this tool is up to him or her. A skilled attorney can offer you strategies for using a bankruptcy to repair your credit.
  3. You may qualify for a new mortgage. If you can prove a good and steady income, a history of on-time payments, and are prepared to make a respectable down payment, many lenders will consider potential buyers who are post-bankruptcy.

What are the first things I should do if I decide to file bankruptcy?

  1. First, you want to hire an affordable and efficient bankruptcy attorney. An experienced and sharp lawyer can make sure you complete all necessary steps and avoid leaving out any debts you want to have discharged.
  2. In order to complete the Official Bankruptcy Forms that make up the petition, statement of financial affairs, and schedules, you must provide the following information:
    • The source, amount, and frequency of your income
    • A list of all creditors and the amount and nature of the debt you owe
    • A detailed list of your monthly living expenses, including food, shelter, utilities, taxes, clothing, transportation, medicine, etc.
    • A list of all your property.
  1. You must complete a credit counseling course BEFORE you file a bankruptcy petition. Individual debtors are required to obtain credit counseling from an approved provider within 180 days before filing the petition and submit the Certificate of Credit Counseling with their petition.  An experienced attorney can help you find an approved counseling agency.
  2. Keep in mind that there are a few types of debt that CANNOT be discharged through bankruptcy. Some of these include alimony, child support, student loans (except in rare circumstances), most taxes, and a few other kinds of debt.

Contact Adam Law Group Today

We understand that you are probably stressed and uncertain if you are facing overwhelming debt. You may even be scared or panicked. That is normal and completely understandable. At Adam Law Group, we understand that even hardworking, responsible individuals can face unexpected financial setbacks, and we are always compassionate toward our clients. We also know money is tight, and we are committed to making bankruptcy affordable. We offer an attractive payment installment plan for those who need it. To find out more about how our affordable bankruptcy lawyers can help you take a first step toward a brighter future, call us at 904-329-7249. The initial consultation is free.