A bankruptcy filing can potentially save you from foreclosure, but it's not a guarantee. In this article, we'll explore what happens to your property when you file for bankruptcy.
When you file for Chapter 7 or Chapter 13 bankruptcy, the court may allow you to keep certain assets, including secured debts like mortgages and car loans. However, the decision ultimately depends on the specific circumstances of your case.
In a Chapter 7 bankruptcy, the trustee will sell off most of your non-exempt assets at auction to pay off creditors. In some cases, the court may allow you to keep certain items, such as:
On the other hand, in a Chapter 13 bankruptcy, you may be able to keep certain assets that are exempt from creditor seizure. These exemptions include:
However, it's essential to note that even if you're able to keep some of your property, you may still be responsible for paying off a portion of the debt through payment plans. Additionally, if you have any equity in the property, such as a second mortgage or refinancing, these assets will likely be sold at auction and used to pay off creditors.
It's also worth noting that some types of secured debts, like student loans and personal loans, may not be automatically discharged in bankruptcy. You'll need to provide documentation to the court to support your claim that you're unable to pay these debts.
Source: Lawyers' Support Organization
a bankruptcy filing can potentially save you from foreclosure, but it's not a guarantee. It's essential to consult with an experienced bankruptcy attorney who can provide guidance tailored to your specific situation.