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You can keep your home when filing a Chapter 7 bankruptcy and still get rid of your credit card and other unsecured debts. If you can afford your mortgage payments and are current with your mortgage payments, then there is no reason why you should not keep your home. Calls us toll free at 1-877-963-9543 to schedule a free consultation to discuss your house in bankruptcy and how bankruptcy can get rid of debts and allow you to keep your home.
In 2005, Congress reformed the bankruptcy code and created the means test. The means test takes into account all of your secured debt payments like your monthly mortgage payments. The means test looks at whether you have disposable income after deducting mortgage payments, vehicle payment and other allowable expenses to determine if you can afford to make payments on credit cards and other unsecured debts. Your mortgage payment is taken into consideration. So if you can afford to make your monthly mortgage payment there is no reason why you should not keep your home.
Houses with Equity
There is only so much equity in a home the California bankruptcy exemptions can protect. This is another factor that needs to be discussed when filing a Chapter 7 bankruptcy and whether you will keep your home. If you have more equity than what can be protected, then you can either file a chapter 13 bankruptcy, see You Have Assets that Cannot be Protected, to ensure you keep your house, or the amount that cannot be protected can be settled with the chapter 7 trustee assigned to your case.
If you qualify to file a Chapter 7 bankruptcy based upon your income, expenses and assets, you will continue to make your mortgage payments after bankruptcy just like prior to filing. See Chapter 7 Timeline Discharging your other burdensome debt will allow you to continue to make your mortgage payments each and every month. If you are having trouble making your mortgage payment or are behind one or more months, see Save Your Home from Foreclosure for more information.