What happens to my home if I file for bankruptcy?

[anonymous]

can a law firm take your home and property for a credit card debt?

[Bankruptcy Helper]

Each state provides that debtors in the state are entitled to a "homestead exemption." What is a homestead exemption? A homestead exemption will protect equity in your homestead up to certain limits. So to answer your question, if the equity in your homestead property is less than the exemption provided under state law, you will not have to sell your house to pay the credits and it will protected if you file for bankruptcy.

More information about bankruptcy and bankruptcy exemptions

The most common and simplest bankruptcy is Chapter 7 Bankruptcy. Chapter 7 Bankruptcy is called a “liquidation bankruptcy”.

In Chapter 7 Bankruptcy, state and/or federal exemptions are outlined in your state’s bankruptcy laws to allow you to keep certain assets. Once you have filed for Chapter 7 Bankruptcy and listed all of your assets, a court-appointed trustee will gather and sell your non-exempt property and use the proceeds from the sale to pay your creditors.

Chapter 13 Bankruptcy does not immediately discharge debts but instead allows debtors to develop a plan to repay all or part of their debts over a 3 to 5 year period. In Chapter 13 Bankruptcy, you are allowed to keep all of your assets as long as you can make the required payments on secured loans.

Property which is exempt in bankruptcy generally falls under the following categories. Talk to a bankruptcy lawyer about how your state and federal exemptions will impact your bankruptcy.

1. Homesteaded property (generally up to a certain amount)
2. Personal property including (types can vary by state)
3. Tools of your trade (not exceed a certain amount)
4. Insurance and award benefits (the types and amounts vary by states).
5. Pensions (type and amounts vary by states)
6. Public benefits including general assistance, occupational disease disablement benefits, unemployment compensation and Workers’ Compensation.
7. Wages (amounts vary)
8. Miscellaneous exemptions (vary by state)

Review "Can filing Chapter 13 bankruptcy save my home?"
"Can Chapter 7 Bankruptcy Save my home?"