Can I Keep My House &
Car If I File For Bankruptcy?
Everyone makes mistakes. In 2021, nearly 40,000 Californians filed for bankruptcy. The reality is that many people will experience financial hardship. When you are facing deep debt, filing for bankruptcy can seem like the only way out. “Bankruptcy” may be a scary word to most because they associate it with the embarrassment of financial failure and the fear of losing all of their possessions. Every case is unique and bankruptcy often isn’t as negative as people think. Everyone needs basic things to maintain a job and home, and filing for any type of bankruptcy wouldn’t mean much if it stripped you of all of your belongings. Simply stated: If you file bankruptcy, you can still get credit and be approved for a place to live.
If you are considering bankruptcy and want to understand what property you can keep, consult with a knowledgeable California bankruptcy attorney for proper guidance. Our team at The Orantes Law Firm is committed to offering excellence in legal services regarding all forms of bankruptcy.
Bankruptcy Basics
Bankruptcy helps people who can no longer pay their debts get a fresh start by liquidating assets to pay their debts or by creating a repayment plan. Filing for bankruptcy can help a person by discarding debt or making a plan to gradually repay those debts. It is common for a bankruptcy case to begin when someone files a petition at a bankruptcy court. Such a petition can be filed by an individual person, by two spouses jointly, or by a business.
Can I Keep My Property
If I File Bankruptcy?
This is one of the most common questions people have when considering filing for bankruptcy, and with good reason. Though there are different factors involved in each type of bankruptcy, you may feel encouraged to learn that you don’t stand to lose everything you own.
Under Chapter 13 Bankruptcy
Chapter 13 bankruptcy is also called the “wage earner’s” plan. This chapter of the Bankruptcy Code provides for the adjustment of debts of an individual with regular income. Chapter 13 allows individuals to keep their property and pay off their debt over time, usually three to five years. Specifically, Chapter 13 offers the opportunity to save your home from foreclosure. By filing under this chapter, you can stop foreclosure proceedings and pay delinquent mortgage payments over time. In 2021, there were 434 California Southern case filings under Chapter 13.
Under Chapter 7 Bankruptcy
Chapter 7 bankruptcy, also known as a “straight” or “liquidation” bankruptcy, can potentially clear away much of an individual’s unsecured debt. If you have fallen behind on your bills and don’t have the means to make monthly payments and provide for your living expenses, filing for Chapter 7 bankruptcy could be an option to help you reset your finances. Under Chapter 7, individuals only lose property in rare circumstances. As long as you are current with house and car payments at the time of filing, your property is typically kept. In 2021, there were 4,414 California Southern case filings under Chapter 7.
Trust an Experienced Bankruptcy Attorney
If you’re overwhelmed by your debt, it’s time to make the decision to act. If you have large debts that you can’t repay, are behind in your mortgage payments and in danger of foreclosure, are being harassed by bill collectors — or all of the above — now is the time to contact an experienced bankruptcy attorney.
Bankruptcy is not a dead end. It may feel like you are out of options, but you are not. At The Orantes Law Firm, we are ready to help you decrease the financial stress in your life and help you decide which type of bankruptcy would be best for your situation. We are proud to serve clients in Los Angeles County, Orange County, Los Angeles, and Irvine, California. Contact us today to schedule your free consultation and initiate your new path to financial freedom.