Is my home at risk in a bankruptcy?
Nearly every day, potential customers ask if filing bankruptcy will result in losing their home. These concerns are valid! Losing your home can be a source of panic, especially for those that own real estate and were in the market during the crash. There are ways to protect your house while filing for bankruptcy. Namely, exemptions.
In bankruptcy, exemptions refer to specific assets that debtors can keep despite filing for bankruptcy. These exemptions are governed by federal and state laws and each state has their own exemptions. Exemptions allow debtors to maintain financial stability and not be left in a state of complete destitution after bankruptcy. If you have limited equity, federal exemptions are the best option. Federal exemptions protect up to $27,900 of real estate equity (11 U.S. Code SS 522) If you have a large amount of equity in your house, Minnesota State exemptions can help. Minnesota exemptions protect up to $480,000 in equity at your residence. (Minn. Stat. 510.02 subd. 1). No matter which exemptions you choose, your mortgage payments should remain the same. Continue to make payments as usual and you shouldn’t have to worry about losing your home. Of course, every situation is different, so if you’re concerned about your home and filing bankruptcy, reach out to Minnesota’s most kind and helpful bankruptcy law firm by going now to
www.lifebacklaw.com
. We’re happy to walk you through what bankruptcy means for you and your home!
