bankruptcy lawyers

Will I Lose My Home If I File Bankruptcy?

bankruptcy lawyers

Probably one of the most common questions bankruptcy lawyers are asked by clients is if they will lose their home when they file bankruptcy. While each individual circumstance is different, in most cases, you will not lose your home. However, you will still be required to make your mortgage payments if you wish to keep your home.  Here are some additional factors to consider: 

  • Chapter 13 bankruptcy is a restructuring of debt.  If you are facing foreclosure and wish to keep your home, your bankruptcy attorney may propose a re-payment plan that covers catching up on delinquent mortgage payments.
  • You are allowed to exempt some of the equity of your home from bankruptcy. Your bankruptcy lawyer can discuss how this may work in your case.
  • Depending on your circumstances, Chapter 13 bankruptcy may allow you to eliminate a wholly unsecured second mortgage on your home. A wholly unsecured second mortgage is one where there is no equity in your home to attach. Again, your bankruptcy attorney will need to look closely at this to determine if your existing second mortgage qualifies.

When filing bankruptcy, Charleston area residents know they can trust the Drose Law Firm to find them the freedom and relief they need. While some bankruptcy lawyers take a “cookie cutter” approach, our bankruptcy attorneys personalize our services and are passionate about providing qualified, experienced advice to the clients we serve.  If you are considering filing bankruptcy in Charleston or surrounding areas, we’re here to help.  Give Drose Law Firm a call today!

Stopping Foreclosure Action

Stopping Foreclosure Action

Can I save my house if the mortgage holder has started a foreclosure action?

As long as there has not been a foreclosure sale, even after foreclosure paperwork has been sent to you, the foreclosure action would be stopped with the filing of the bankruptcy case, and the mortgage default could be made up.  If you are able to formulate a plan that meets the tests below, and would provide for resuming the payments and making up the default, then a Chapter 13 filing would still save the house.

There are really four tests that are used by courts in deciding whether to confirm a Chapter 13 plan.  The Debtor needs favorable rulings on all of the following issues, and may have other criteria to consider:

  • Are the unsecured creditors getting as much over the life of the plan as they would have received if the Debtor had filed a Chapter 7 and non-exempt property was sold?
  • Does the plan pay all secured creditors in full, plus interest, to the extent of the value of collateral, and pay all past due support and taxes in full?
  • Does the monthly amount equal the amount available from all of the Debtor’s income after reasonable expenses, for at least three years?
  • Does the overall effect of the plan suggest the Debtor is acting in good faith?
  • The Debtors sometimes have to propose more than one plan in order to convince the trustee and the Court that the plan meets all of the criteria above.