The decision to file for bankruptcy is never an easy one to make. However, it is not usually a decision that people have much time to consider. It’s often a decision that is taken at a time when there are a limited number of other options.
When a little time and research is invested into learning about how bankruptcy works, many debtors can benefit from making lucrative choices that enable them to prioritize what is important to them, which, for many people, is the ability to keep the family home.
Contrary to popular belief, it is possible to keep the family home before, during and after the bankruptcy filing process in certain situations. The ability to do this is highly dependent on the type of bankruptcy that you file for, the amount of equity you have in your house at the time of your bankruptcy filing, and the feasibility of your mortgage repayments.
What type of bankruptcy should I file for if I want to keep the family home?
As an individual filing for bankruptcy, you can either choose to file for Chapter 7 bankruptcy or Chapter 13 bankruptcy. It is important that you take the time to understand the pros and cons of each bankruptcy filing and its relevance to your situation. Generally speaking, Chapter 13 offers more flexibility than Chapter 7. While, in theory, you may be able to keep your home when filing for either, it is likely that it will be easier to do so with a Chapter 13 bankruptcy filing.
How do the mortgage repayments affect my ability to keep the home?
The bankruptcy process is tough and requires that you keep up with all payments. If you are to keep your home while filing for bankruptcy, you must make sure that you can afford to continue paying your mortgage throughout the entire period. Many debtors opt to downsize their living arrangements so that they have an easier time repaying their debts.
If you are considering filing for bankruptcy in the state of Maryland but are concerned about losing your home, it is important to find out more about the realities of filing for bankruptcy.