Can you keep your home if you file for bankruptcy?

Answer 1

There are a couple of different things to consider. First, it depends upon the bankruptcy laws of the state you are in. Specifically, if there is a homestead exemption in your state. If there is a homestead exemption, then the creditors cannot take your house / force the sale of your house. However, you must be careful in this area because new bankruptcy laws were just passed & this area of bankruptcy law may have changed. Another factor to consider is whether you have any equity in your house. The last time I checked, the home equity limit was $18,450, doubled for married couples (Dec 2004). If you have no equity (or very little) and you do not list your home mortgager in your bankruptcy, then you do not have to sell your house. However, if you have a lot of equity, and there is no homestead exemption, they can usually force the sale of your home. Here are some excerpts from a bankruptcy article I read in March of this year. It'll give you a better idea of the changes I referred to earlier. "Bankruptcy Bill Set for Passage Is a Victory for Bush By STEPHEN LABATON, The New York Times WASHINGTON (March 9) The bill would impose a means test that would prompt many people to file for bankruptcy protection under Chapter 13, which requires a repayment plan. The means test would not be applied to debtors who earn less than the median income in their state. Those who earn more than that and can pay at least $6,000 over five years would have to seek protection under Chapter 13. The median income for a family of four in 2003 was $65,093, ranging from $45,867 in New Mexico to $82,561 in Massachusetts, according to the United States Census Bureau. The bill would also increase the costs of bankruptcy by increasing the amount of paperwork filed and force people in bankruptcy to pay for counseling about the way they use credit. It would also make it more difficult for some people to try to shelter their assets through the purchase of expensive homes in states like Florida and Texas, which have homestead exemptions. To shelter more than $125,000 in assets, homes must have been purchased at least three and a third years before a bankruptcy filing".

Answer 2

A primary residence is a "secured debt" and is very rarely forfieted in banruptcy proceedings unless the borrower is unable to reaffirm the loan with the mortgage lender. In most cases the homestead exemption will protect a residence, this does not however apply to a foreclosure. yes you can stay with your home as long as you did not listed the mortgage as one of you debt to be discharge.

Answer 3

When you file bankruptcy, you are required to fill out quite a few bankruptcy papers. Among these are Schedule C, which is a form where you list the property you are claiming should be exempt (meaning you get to keep it).

Both federal and state laws provide exemptions for certain property that a debtor is allowed to claim as exempt. What property is eligible for exemption status varies from state-to-state; however, some states allow you to choose whether to use the federal exemptions or your state's exemptions. If federal exemptions allow you to keep more property than your state's exemptions, then you should opt for federal, provided your state allows it (not all states allow you to choose between federal and state exemptions).

The following states DO ALLOW you to use the federal bankruptcy exemptions if you want: Arkansas, Connecticut, Washington, D.C., Hawaii, Massachusetts, Michigan, Minnesota, New Jersey, New Mexico, Pennsylvania, Rhode Island, South Carolina, Texas, Vermont, Washington, and Wisconsin.

The following states DO NOT ALLOW you to use the federal bankruptcy exemptions: Alaska, Arizona, California, Colorado, Delaware, Florida, Georgia, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, South Dakota, Tennessee, Utah, Virginia, West Virginia, and Wyoming. If you do not use the federal exemptions (either by choice or requirement), you are also allowed to use the federal non-bankruptcy exemptions.

What property is exempt under federal law?

Remember that only 15 states and Washington, D.C. allow you to use the federal bankruptcy exemptions (see above). These exemptions can be doubled if you are filing bankruptcy jointly with your spouse --

Personal and Real Property:

(1) Household: Up to $425.00 per item not to exceed a total of $8,625.00 (includes animals, appliances, books, crops, furnishings, household goods, clothing, Musical Instruments)

(2) Jewelry: Up to $1,075.00

(3) Vehicles: Up to $2,575.00

(4) Work tools (implements, books and tools of trade): Up to $1,625.00

(5) Health aides (wheelchair, etc.): Unlimited

(6) Burial plot: Up to $16,500.00 (in lieu of real estate exemption)

(7) Real estate (house, co-op or mobile home): Up to $16,150.00

(8) Any property: Up to $8,075.00 of unused portion of real estate exemption

Wages, Pensions, Recoveries and Benefits:

(1) Wages: None

(2) Wrongful death funds: Amount needed for support

(3) Personal injury funds: Up to $16,500.00 (excluding that for pain and suffering or pecuniary loss)

(4) Lost earnings payments: Unlimited amount

(5) Retirement benefits: Amount needed for support

(6) Alimony / child support: Amount needed for support

(7) Unemployment compensation: Unlimited amount

(8) Veterans benefits: Unlimited amount

(9) Social security benefits: Unlimited amount

(10) Public assistance: Unlimited amount

(11) Crime victims compensation: Unlimited amount

Insurance:

(1) Disability: Unlimited amount

(2) Unemployment benefits: Unlimited amount

(3) Unmatured life insurance: Unlimited amount

(4) Life insurance policy loan value, dividends or interest: Up to $8,625

(5) Life insurance proceeds: Amount needed for support

What property is exempt under state laws?

In general, most states allow you to keep much of your personal property, particularly that which has little or no value. You can even keep collateralized property in certain circumstances (of course, you have to reaffirm the debt).

Personal property includes tools that you use to earn a living (although there are limits on this); your clothing; and all of your household goods. As to your income, usually about 75% of your wages, and all of your unemployment and welfare benefits, worker's compensation, pensions, and insurance benefits are exempt. Most states allow you to double the amount of the exemption if you're married, but not all states, so make sure your state allows this before doing any calculations.

Answer 4

yes you can because you cant pay mortage