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To Keep or Not to Keep Your House

If you’re facing financial trouble, you’re probably asking yourself one question above all others: should we sell our house?


A residence is typically the most valuable asset an individual or family owns. Not surprisingly, it’s also frequently the asset against which the most amount of debt is leveraged. Residential mortgage debt often extends into the range of hundreds of thousands – if not millions – of dollars. It can be the source of an incredible amount of personal and financial stress.


If you qualify under the Chapter 13 means test, your bankruptcy attorney may be asking himself one question above all others: should the ownership of this house determine whether this debtor enters Chapter 7 or Chapter 13 bankruptcy?


A Chapter 13 bankruptcy is the personal equivalent of a corporate restructuring under Chapter 11. Under Chapter 13, a debtor may elongate his debt repayment schedule, retain levered assets, and force his creditors to bet with him on his future. Under a Chapter 7 liquidation, however, a debtor loses more of their assets immediately.


How much do you value your residence? This question may be central to your upcoming financial planning if you’re a distressed debtor. To find out the answers to your questions, including how you should approach the timing and strategy of your debt relief options, talk to the bankruptcy professionals at Fears Nachawati today.


To Keep or Not to Keep Your House