home equity line of credit in default along with 20K in unsecured debt . Would chapter 7 or 13 be most suitable . Would like to keep condo and car .
Ch7 will discharge the 20,000 and the HELOC (and the mortgage for that matter) but not the HOA lien. And the HELOC will still have a lien on your property; but you would be able to strip that lien in a Ch13 if your house is worth less than what you owe on the mortgage. Still, CH7 may make the most sense if you can catch up on the HOA not having to pay on the unsecured debt. Ans if the HELOC is virtually unsecured, you may be able to pay them some money to release their lien.
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There isn't enough information her to give you advice on whether a chapter 7 or 13 would be preferable. Generally, a person who is current on his or her mortgage and who can exempt all of his or her home equity is more likely to file a chapter 7 case. You can keep your condo if you are current on the payments and all of the equity is exempt. Same thing applies to a car that you are still paying for. (In the case of a car, you'd have to reaffirm the loan if you wanted to keep it.)
You would be wise to take advantage of the free consultation that nearly all bankruptcy attorneys offer. Meet with a few attorneys and pick the one that helps you understand the options and the pros and cons of each.
This answer is for general information purposes only and is not legal advice. No attorney-client relationship is intended or formed by the posting of this answer.
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Chapter 7 Bankruptcy Attorney
There is no hard & fast answer without knowing a lot more info, such as value of your mortgage debt & value of the property, which is why people meet with a local attorney for a consultation. To keep the property, you will have to make payments on the HOA lien, but you may be eligible to strip the 2nd mortgage if you chose Chapter 13. However, many times I am able to settle a 2nd mortgage after a Chapter 7, so it really depends on what you can qualify for as well as what the entire debt situation looks like. Hope this perspective helps!
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If your goal is to keep the condo then it does not matter what chapter you file you will have to pay the HOA dues. Filing a chapter 13 will allow you to catch up on those back HOA dues over a 36-60 month period and possible strip off the home equity line of credit. However, there are a lot more issues that need to be discussed before one can advise you as to what chapter would best accomplish your goals.
I have an office in Pleasant Hill and provide free consultations.
Remember that on this forum attorneys try to answer your questions with limited facts available to them. My answer should in no way be considered legal advice. No attorney client relationship has been formed by any answer given here.
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