Having too much debt often leads to stress and anxiety, and if you count yourself among the many people struggling to make ends meet this year, you may be thinking about bankruptcy. If you are thinking about doing so and are also a homeowner, you may have concerns about whether you stand to lose your home if you move forward. Simon Fitzgerald LLC’s bankruptcy blog has earned inclusion on FeedSpot’s “Top 100 Bankruptcy Blogs” list and offers valuable insight in this area.
So, are you at risk of losing your home if you file for personal bankruptcy? Per SFGate, losing your home when you file for bankruptcy is a possibility, rather than an absolute.
Your home and Chapter 7 bankruptcy
You are more likely to have to surrender your home if you file for Chapter 7, as opposed to Chapter 13, bankruptcy. This type of bankruptcy filing often involves liquidating your assets so you are able to pay back some of your outstanding debts.
Your home and Chapter 13 bankruptcy
If keeping your home is important to you, you may want to see if you qualify for a Chapter 13 bankruptcy. This type of filing has you restructure your outstanding debts so that they become easier to manage. If you stick to your payback plan and stay current on your mortgage payments, you may be able to keep your house with a Chapter 13 filing.
Keep in mind that, just because a certain bankruptcy type may allow you to keep your home, this does not necessarily mean this is your most favorable option. Sometimes, it may benefit you money-wise to sell your home.