Will I Lose My House or Cars if I File for Bankruptcy?
Only if you stop paying for them. But the bankruptcy will not cause you to lose your home or car. In rare cases, if a person has too much equity in their home and they file a Chapter 7, the trustee would have the right to liquidate or sell the home to pay off debts. That is why attorneys put those with too much equity in their homes in Chapter 13’s. In these cases, the Debtor is paying a percentage of their debt back. But in both bankruptcies, homes and cars are safe. Just keep making your payments to those lenders on time and in full and no problems will arise. There are rare, rare, rare cases where the Trustee does sell the Debtors home but this is where the Debtor has a lot of unsecured debt, a large amount of equity in their home, and usually no job or means to pay a percentage of their debts back through a Chapter 13. The large amount of equity in their home disqualified the debtor for a 7 and therefore leaves them with a Chapter 13 option. In the 13 option, the debtor is obligated to pay a percentage of their debts back. But if the Debtor is unemployed and has no money to pay a that percentage back called a plan payment, then if the Debtor decides to file a Chapter 7, they would be fully aware before the filing what the trustee would be doing with their property. As I stated, these cases are so rare. Most people today do not have any equity in their homes or if they do, it is exempted. Each state has different expemptions for homested and you should call to discuss your options. These are the areas that we do discuss with you upon calling our office to help you understand the differences and which bankruptcy is best for you to file. We give you this information for free and usually spend up to 20 to 30 minutes with you so you have a good idea of what you would be filing, the fees for this process and what is involved.
Lee Abt is an Experienced Bankruptcy Lawyer in New Jersey - Call Today!