BANKRUPTCY
CHAPTER 7 & CHAPTER
13
The common bankruptcies
that are filed by
property owners in
foreclosure are chapter 7
or chapter 13
bankruptcy. Under
the 2005 Bankruptcy Act
your financial status
will be analyzed to
determine if you are
eligible for Chapter 7
bankruptcy or in eligible
and have to file Chapter
13 bankruptcy.
2005 BANKRUPTCY
ACT (October 17,
2005)
- Requires all
individuals to have
credit counseling
within six months of
filing bankruptcy
- Requires all
individuals to take an
instructional course on
Financial Management
within six months of
filing bankruptcy
- Average income for
the last 6 months prior
to your bankruptcy is
measured against the
"MEANS TEST"
CHAPTER
7
BANKRUPTCY
Chapter 7 bankruptcy code
provides for the
liquidation of nonexempt
property and the
distribution of proceeds
from the liquidation to
pay creditors A petition
is filed with the court
asking for a discharge of
your debts. The
basic idea is to wipe out
your debts in exchange
for you giving up
property. There is
"exempt" property that
the courts allow you to
keep. Property that
falls into the
"non-exempt category will
be sold and distributed
to creditors Filling
bankruptcy under Chapter
7 will not be the right
choice for you if you
want to keep your
house. Chapter 7
bankruptcy will not
eliminate your
obligations to pay your
mortgage lender and they
will most likely
foreclose on your
property if you stop
paying your mortgage.
People tend to confuse
the automatic stay
created in the initial
filing for bankruptcy.
The automatic stay
provides a time period
that prevents creditors
from making direct
contact with you or
staking a claim on any of
your property from the
day filing forward.
Remember this is a
temporary stay until the
court decides what type
of bankruptcy is
applicable to your
situation. It does not
eliminate your obligation
to your mortgage.
CHAPTER
13
BANKRUPTCY
Chapter 13 bankruptcy
results in a plan that
shows how you will pay
off your current debts
over 3-5 years.
When Chapter 13 is
granted by the courts
this allows you to keep
valuable property like
your home. Your
payment amounts are
usually not reduced and
will most likely stay the
same plus some extra
payment for getting
caught up. You
should consider filing
Chapter 13 if you are in
danger of loosing your
home but, can catch up if
you are given some time.
If your intent is to not
pay for your mortgage
after being placed on a
payment plan your
property can still be
foreclosed on.
HRS's
VIEW ON CHAPTER 13 AND
YOUR
HOME
Filing bankruptcy with no
intent to pay your
mortgage will result in
you loosing your
house. The impact
on your credit can be
detrimental in your
survival in a world that
revolves so heavily on
your credit as a mirror
of the individual.
Bankruptcy can effect
your ability to get jobs.
secure loans, purchase a
home, and even rent an
apartment. The
individual needs to asses
their own situation and
look to see if the future
will allow for them to
make payments as excepted
under a payment plan. If
there are no intentions
of paying your mortgage
please look into selling
your house to Home
Recovery Solutions. We
have helped people remove
the burden of foreclosure
and bankruptcy through
our simple purchasing
program that in most
cases requires no cost to
the seller and is cheaper
and faster than the
conventional ways selling
your home.
FOR MORE
INFORMATION ON BANKRUPTCY
LAW:
CLICK
HERE: U.S.COURTS
DISCLAIMER
