Many people avoid filing bankruptcy because they are afraid they will lose their home. In reality, bankruptcy may be the best way to protect your home, regardless of how much equity you have in it.
At the Orantes Law Firm in Los Angeles, we offer a free initial consultation to discuss your debt problems and give you honest answers about your options with respect to your home. You will have no obligation to hire us following this consultation.
Protecting Equity in Your Home
In California, you can protect up to $100,000 in equity in a primary residence if you are married. If you are single, you can protect up to $75,000. This is known as the homestead exemption. However, even if you have more equity than is allowed under the homestead exemption, you can still keep your property by filing Chapter 13 bankruptcy.
Chapter 13 bankruptcy is a good option for people who have both significant debts as well as significant assets. When you file Chapter 13 bankruptcy:
- The automatic stay protects you from home foreclosure and other types of creditor harassment.
- You can put mortgage arrearages into your Chapter 13 payment plan and pay it off over a five-year period.
- If you have a second mortgage and are underwater on your first mortgage, you can strip the lien from the second mortgage and treat it as an unsecured debt.
Many creative bankruptcy strategies are available. For example, you can file Chapter 7 bankruptcy to discharge unsecured debt and immediately follow your Chapter 7 filing with a Chapter 13 filing to protect your secured property.
Can I Protect a Second Home or Costly Home?
If you own rental or vacation property, you can keep your property and reduce the outstanding mortgage to the current market value through a
cram down. If you own very significant property, you can protect it by filing
Chapter 11 bankruptcy.
Contact Our Los Angeles Bankruptcy Attorneys
For more information about protecting your home, call 213-389-4362 or
contact us by e-mail to schedule a free lawyer consultation. Se habla español.