I am un-employment for the last four years. However, I owned two houses and that is my source of income and I am barely make it each month. On the paper, the two houses have equity - but I have a lot of deferred maintenances. One of the house is in really in bad shape that I can not rent it out as the roof is leaking, etc.
My question is ... if I file for BK7, can I keep both houses?
The bankruptcy law provides several exemptions that allow the individual to retain property. You would need to sit down with an attorney to discuss what property you would be able to protect in your Chapter 7 case. If you cannot keep the property in a Chapter 7 then a Chapter 13 case may be right for you. Either way, you are going to need to talk to an attorney. Many attorneys like myself, who practice in this area, offer a free consultation in order to determine if they can help you.
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I suggest you have the houses appraised so you can get an opinion on the true market value. Then sit down with a local, reputable bankruptcy attorney who can go over your entire financial picture. If you do have nonexempt equity in either of your homes, it could be that you would be better off in a Chapter 13 so long as you have sufficient income to fund the plan. If it is California exemptions which are applicable (we don't know that based on your facts), bear in mind that if you live in one of the houses, then you may be able to use the generous homestead exemption under the 704 series of exemptions to protect the equity in that house. However, you would not be able to exempt any equity existing in the other house because there would be no exemption for a second home under that set of exemptions (the "704 series"). This means that home would be unprotected in a Chapter 7. If your equity in both homes is nonexistent or very small, you may be able to protect both homes in Chapter 7 using the 703 series. If you have nonexempt equity using either set of exemptions, then you may consider filing a Chapter 13 instead, again, if you can afford the required payment based on your income. Again, you need to sit down with a bankruptcy pro and have them go over your complete situation. Get the appraisals done first, so you know the true value of your homes.
The information provided herein is general information only and not legal advice. The information provided herein does not create an attorney client relationship and is not a substitute for having a consultation with an attorney. It is important to have a consultation with an attorney as the information provided in this forum is limited and cannot possibly cover all potential issues in a given situation.
I agree with my colleague. If you want to keep both houses, you needed to sit down with an experienced bankruptcy to see if you can protect the equity in one or both houses. Generally, in CA you can protect equity in your principal residence of $75k if single; $100k if married or dependents living in home; and $175k if disabled or over 55 and making low income. If there is too much equity you still may be able to file Chapter 13 to pay a portion of your debt and have the remaining eliminated. Meet with an attorney for free to evaluate your situation and give you advise moving forward.
The information provided herein is general information only and not legal advice. The information provided herein does not create an attorney client relationship and is not a substitute for having a consultation with an attorney. It is important to have a consultation with an attorney as the information provided in this forum is limited and cannot possibly cover all potential issues in a given situation
Maybe. You may be able to protect the houses by exempting the equity in each home. Not enough information provided to opine further. Carefully review the equity in each house and available exemptions with BK counsel.
There really isn't enough information to answer your question based on what you posted. Certain exemptions may be available to you under the bankruptcy code and state law that might allow you to file bankruptcy and retain ownership of your properties. The exemptions are specific as to dollar amount of equity that you can protect and depend on such factors as state residency, use of the property as your residence, age, marital status, income, and whether you are disabled. This is really a question that is best answered with a full in depth review of your sitaution. Most banruptcy attorneys in San Diego including myself give free consultations. I would advise you to set up an appointment for a free consultation.
First you need to find out what the houses are worth to determine the actual equity in the property. Only after that is determined can any bankruptcy counsel be able to advise you if you can protect both houses in a chapter 7 or if a chapter 13 or other options would be better choices.
This response is not intended as legal advice. You may need to consult your own attorney to obtain a more specific answer.
You will have to take the time and meet with an attorney for an evaluation of your circumstances. There are too many variables. If you wish to keep both properties, all your assets and all your debts have to be completely reviewed.
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