Declaring bankruptcy is scary. Even though you know that doing this will help you finally get free of debt and reclaim your financial independence, you may worry about what it’s going to cost you. At JPP Law, one of the most common questions we hear is, “Can I keep my house even when declaring bankruptcy?”
The answer is… maybe.
The truth is, declaring bankruptcy is a complicated process with many factors to take into consideration. That’s why you need help from someone with knowledge and experience. JPP Law’s bankruptcy lawyers in Wyoming can help you navigate the pitfalls of bankruptcy, answering all your questions, and providing expert advice every step of the way.
The most crucial thing in determining whether or not you’ll be able to keep your house during bankruptcy is what kind of bankruptcy you’re declaring: Chapter 7 or Chapter 13. Below, we’ll explain the differences between the two and help you better understand how safe your home is.
Keeping Your Home Under Chapter 7 Bankruptcy
The main difference between Chapter 7 and Chapter 13 is what exemptions each one entitles a person to. In Chapter 7 bankruptcy, the primary way your debts are settled is by liquidating your excess property, which could include your home.
Declaring Chapter 7, bankruptcy is a fast way to settle your debts, at the cost of strict exemptions that only allow you to keep property valued under a certain amount. In other words, the more equity you have in your home, the less likely you are to keep it.
That said, if your home equity doesn’t surpass the exemption threshold, Chapter 7 is a good way of freeing up other funds that will help you stay up to date on your mortgage payments.
Keeping Your Home Under Chapter 13 Bankruptcy
While Chapter 13 is a slower process than Chapter 7, it gives certain individuals a much better chance of keeping their home. The difference is that Chapter 13 bankruptcy is for those who bring in enough income to pay off their debts if given more time.
Unlike Chapter 7, Chapter 13 doesn’t involve liquidating property but instead allows you to propose a debt repayment plan that is more manageable than your current one. This plan can include your mortgage debt, making it an attractive option for those who are eligible.
However, it’s important to note that if you fall behind on your new payment plan or suffer a reduced income, your Chapter 13 bankruptcy may be dismissed, which could result in you losing your home.
JPP Law Has the Best Bankruptcy Lawyers in Wyoming
When you’re filing for bankruptcy, you need someone by your side who knows the ins and outs of the legal system. You need someone who cares for the well-being of you and your family. You need someone who can not only answer the question, “Can I keep my house even when declaring bankruptcy?” but also “How exactly do I do that?”
In other words, you need JPP Law.
Don’t get it alone. We’re here to help. Contact us today for a free consultation with one of our bankruptcy lawyers in Wyoming. You’ll be glad you did.