Can I keep my home and car if I file for bankruptcy?
While you may be able to keep your home and your car if you file for bankruptcy, there are some important requirements to keep in mind. Further, Chapter 7 and Chapter 13 bankruptcies are structured in different ways, and one or the other may work better for you when it comes to protecting your home and car. If you have questions or concerns about bankruptcy, an experienced Columbia, SC, bankruptcy attorney is standing by to help.
Chapter 7 Bankruptcy
Chapter 7 bankruptcy is the most common form of bankruptcy in South Carolina and throughout the nation, and it’s generally reserved for those with fewer assets and who earn less. While Chapter 7 is the most streamlined form of bankruptcy, this doesn’t alter the fact that it’s legally complex.
Chapter 7 involves a liquidation process, which means specific assets will be sold – or liquidated – to pay off your pending debts. You will, however, retain important exemptions that include your car and your home within certain parameters. Chapter 7 bankruptcy will only protect your home and car if the following apply:
- Your equity in your home – or the value of the percentage that you’ve paid off – is relatively low.
- The value of your car – or the amount that it’s worth minus what you owe on it – is relatively low.
- You continue making your mortgage payments and paying off your car – as applicable.
If these aren’t relevant to your situation, you could lose your home, your car, or both.
Chapter 13 Bankruptcy
If you’re worried about losing your car, home, or both, chapter 13 bankruptcy may be a better option. Often referred to as the wage earner’s bankruptcy, chapter 13 amounts to financial reorganization, which means you’ll very likely be required to pay a portion – or all – of the debt you owe, as determined by the bankruptcy court in relation to your financial circumstances.
Saving Your Car and Home
Both your home and your car are secured debts, which means they are secured by the collateral of your house or your car, respectively. When you file under Chapter 13 or Chapter 7 bankruptcy, you stop the foreclosure or repossession process in its tracks. With a Chapter 13 bankruptcy, however, you can make arrangements with your lenders to cure your delinquency for your home and your car over time, which can afford you the financial wiggle room you need to keep both.
Reach Out to an Experienced Columbia, South Carolina, Bankruptcy Attorney Today
The thought of losing your car, your home, or both is daunting and when you layer this anxiety over the financial issues you’re facing, it can feel insurmountable. Fortunately, the compassionate bankruptcy attorneys at Reed Law Firm – proudly serving Columbia, South Carolina – have the experience and legal insight to help you improve your financial situation through bankruptcy while sparing no effort in relation to saving your car and home. We are on your side and here to help, so please don’t put off reaching out and contacting us online or calling (803) 726-4888 for more information about what we can do for you today.
