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Can I Keep My House?

This is one of the biggest questions when it comes to filing bankruptcy. Generally speaking, you usually can save your home and still obtain debt relief under either Chapter 7 or 13. The trick is to determine which category best suits your situation. Brian G. Hiatt can assist you in making this determination, but here follows a brief, general discussion of the issues involved.

Reaffirming Your Mortgage

If you are filing Chapter 7 in Illinois, are current on your mortgage payments and have less than $15,000 in equity (or $30,000 if you are married), you can “reaffirm” your mortgage, that is, agree to continue paying the mortgage despite the bankruptcy.

If you reaffirm the mortgage, you will be obligated to pay it after your discharge, even if your financial circumstances change and you can no longer afford it.

Filing Chapter 13 To Save Your Home

If you are behind in your mortgage payments, Chapter 7 will not work, unless you wish to surrender the home or pursue a loan modification. But you can avoid or stop foreclosure by filing a Chapter 13 and proposing a plan to catch up your payment arrearage. However, to do so you must have disposable income that will fund a repayment plan.

Preventing Liquidation Of Your House

If you own your house outright or have substantial equity (more than $15,000 for an individual filer or $30,000 for a married couple), you risk liquidation of your home if you file Chapter 7. You can file Chapter 13, but you have to pay your creditors at least as much as they would get from the sale of the house in a Chapter 7.

Protect Your House By Getting Answers To Your Questions About Bankruptcy

All of these considerations can be made easier in consultation with a skilled lawyer. Contact attorney Brian Hiatt to learn more about how bankruptcy can be used to save your house. To schedule a free consultation, call the office in Bourbonnais 815-304-5441 or send an email using the online contact form.

Brian G. Hiatt’s law firm is a debt relief agency. It helps people file for bankruptcy relief under the Bankruptcy Code.

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