Will I Lose My House if I Declare Bankruptcy?
Many people mistakenly assume that bankruptcy is financial suicide. However, the truth is that bankruptcy has helped millions of Americans start their path toward a debt-free life.
There are several chapters of bankruptcy, with Chapters 7 and 13 being the most common. The eligibility criteria and consequences of filing each chapter vary, and one factor that sets them apart is the possibility of liquidating assets.
What Will Happen to My Property if I File for Bankruptcy?
According to Uscourst.gov, Chapter 7 bankruptcy involves the liquidation of assets to pay off creditors. As a result, filers may need to sell their home or other properties to pay debts.
Every case is unique, and not all Chapter 7 filers will have to sell their home. Also, there is a homestead exemption in Illinois bankruptcy cases which will allow you to preserve a portion of your home's equity. Depending on the details of your mortgage, the trustee may decide not to group your home with the liquidated assets.
For those who are filing for Chapter 13 bankruptcy, property loss is not as much of a concern. Chapter 13 involves a structured payment plan for debts; therefore, you are not required to sell your assets to make payments.
In order to be eligible for Chapter 13 bankruptcy, you must generate enough income to fulfill a reasonable payment plan. Your previous bankruptcy history may also affect your eligibility. Moreover, if you fail to keep up with the Chapter 13 payments, then it is possible that your Chapter 13 case will transfer to Chapter 7.
A Skilled Illinois Bankruptcy Lawyer Can Help
Each bankruptcy case is different. Therefore, if you are considering filing for bankruptcy it is important that you speak with an experienced and knowledgeable McHenry County bankruptcy lawyer. Contact Thomas Law Office to schedule your consultation. Attorney Colleen Thomas can evaluate your situation to create a debt-relief plan for your unique needs. Call 847-426-7990 today.
Source:
http://www.uscourts.gov/services-forms/bankruptcy/bankruptcy-basics/chapter-7-bankruptcy-basics© 2024 The Thomas Law Office. All rights reserved. Disclaimer | Sitemap
Thomas Law Office has been serving the needs of clients throughout McHenry County and Kane County in cities such as Elgin, South Elgin, Barrington, Carpentersville, Marengo, West Dundee, East Dundee, Algonquin, Lake in the Hills, Huntley, Crystal Lake, Woodstock, Bull Valley, Fox Lake, Fox River Grove, Harvard, Hebron, Holiday Hills, Huntley, Island Lake, Geneva, Wonder Lake and Cary.
