People have many concerns when they come into my office, but a few concerns seem to come up more often than not. One concern that is in the forefront of many minds is the fear of losing their home if they file bankruptcy.
The answer depends on whether or not there is any net equity available if your property was to be sold. Net equity is calculated as: appraised value minus selling costs and mortgages.
If there is no net equity in your property (ie: the value of your property is less than the amount of your mortgages and selling costs) then there is no issue with keeping the property.
If there is net equity (ie: the value of your property is more than the amount of your mortgages and selling costs) then the creditors would want the owners share of this net equity amount to be paid to them.
Having net equity does not mean that you will have to sell your house. It does not matter to your creditors whether the net equity proceeds come from the sale of the house by the trustee or from you personally. If you are able to make payments totalling the amount of the net equity, you can keep your house.
Many people that go bankrupt own their homes. Though some have equity in their properties and others do not, the majority in each group are able to keep their homes despite their filing personal bankruptcy.
If you’re struggling with debt and don’t want to lose your home, contact us today. If bankruptcy isn’t an option, we may have another solution for you.
