Can Bankruptcy Save My Home?
Jan. 4, 2020
The question of whether bankruptcy could save your home depends on a variety of factors. However, most people who qualify for personal bankruptcy in Oregon also qualify for a significant exemption to protect the value they hold in their home.
Various important factors in this case include the amount of equity you hold in your home, the total market value of your property, and the type of bankruptcy for which you apply. For the purpose of this discussion, examples will focus on Chapter 7 bankruptcy or liquidation. Please continue reading for more details on these topics.
Chapter 7 bankruptcy is a way of selling assets to cover your debts. Beyond the amount you could reclaim from sales, you could conceivably have the rest of your debt forgiven. In most cases, you would have to sell many non-essential assets. This might include excess equity you hold in your home. Additionally, based on how much your home is worth, it could exceed the maximum protected amount.
Whether you could keep your home could also depend on which type of bankruptcy you pursue. For example, those who have significant assets to protect and study earnings may want to consider options other than Chapter 7 for debt relief. Chapter 13, for example, allows the formation of a repayment plan. If you were to comply with the terms of your plan, you could conceivably maintain your current way of life while getting out from under unmanageable debt.
There are many factors that go into forming a debt relief strategy that has the best chance of creating financial stability for you. Please do not regard this as legal advice. It is only general information.