For Homeowners, this is really big. Bankruptcy law allows you to stop all collection activities, even foreclosure, instantly. However, whether or not you get to keep your house ultimately depends on whether you can pay the mortgage. If you can get a loan modification that is great. So long as you are able to satisfy whatever agreement you have with your mortgage lender, you can keep the home. However, sometimes people get behind on the payments and that is when they need a bankruptcy attorney.
With Chapter 13 bankruptcy you can:
- repay your mortgage arrears over a three to five year period.
- sometimes eliminate your second mortgage all together!*ask an attorney
- save your house and buy time to get caught up or sell the house
- save a lot of money on interest, fees, and penalties
- have the bankruptcy court protect you while you do your repayments.
With Chapter 7 and Chapter 13 you can always protect some equity in your house. How much equity depends on a lot of factors. Some factors include:
Which state you file bankruptcy
Who is on Title
Who files bankruptcy
Where you live
The exemptions that apply.
It would be useless and irresponsible of me to try to explain all the nuances of this analysis in an essay. To really be sure of your options, you should speak with a bankruptcy attorney. Our attorneys offer free consultations in New York, New Jersey and many other states.
For your information, here is information about the homestead exemptions in states where our attorneys practice.
The homestead exemptions are the laws that dictate how much equity you can have in your house when you file bankruptcy. Again, it is very important that you consult with an expert bankruptcy lawyer to know exactly how the protections apply to you.
New York Bankruptcy Law (it is the same whether you file bankruptcy in New York City or file Bankruptcy in Westchester or Rockland or upstate New York)
New York Homestead Exemption: $50,000 per debtor on title to the property