Here is a typical situation with multiple debts that can be resolved by Bankruptcy Law Professionals:
I owe $285,000 on a money-pit of a home that’s worth way less. I have over $50,000 in credit card debt, a car that’s soon to be repossessed, a few hospital bills, and a $1,500 lien on my home. I’m thinking about filing bankruptcy. I am also considering letting the money-pit go by filing a deed-in-lieu of foreclosure. Which process should I pursue?
BANKRUPTCY LAW PROS:
A chapter 7 bankruptcy will resolve all of these debt issues with one bankruptcy filing. Here is how the bankruptcy will address all of the debts.
1. 285k home mortgage debt can be resolve in a few ways. If this client chooses to give up the home with a deed in lieu of foreclosure, the bank will satisfy all of the requirements on the loan with the acceptance of a deed in lieu of foreclosure. If there are any junior loans or a 2nd loan (aka HELOC or Home Equity Line of Credit), we can discharge any liability of the junior loans by including them in the bankruptcy. If the client chooses to short sell the property, a chapter 7 may delay any foreclosure proceedings to provide more time for a short sale negotiation. Any junior loans will be taken care of in the chapter 7 as previously described.
2. Auto repossession can be resolved in the chapter 7 bankruptcy. We will include the auto loan in the bankruptcy so that any deficiency amount in the loan will be discharged.
3. Medical bills (hospital bills) can be discharged in the chapter 7 bankruptcy as unsecured debt.
4. $1,500 lein on home can become unsecured debt if the home is sold, foreclosed, or surrendered in a deed in lieu of foreclosure. The lein can be included in the chapter 7 bankruptcy and discharged as unsecured debt after the home is sold or foreclosed or surrendered if the debt is not handled from the resolution of the home loan.
5. $50,000 of credit card debt can be discharged in the chapter 7 bankruptcy as unsecured debt.
As you can see from the response above, the chapter 7 bankruptcy by Bankruptcy Law Professionals takes care of all of the issues the client is dealing with. We charge one flat attorney fee to handle all of these issues for you. There are no additional costs for multiple creditors and multiple outstanding issues.
If you are interested in more information on any of these types of debts or topics, contact us at (855) 257-7671.
We have offices in La Mirada, Tustin/Santa Ana, and Riverside to serve Los Angeles, Orange County, and the Inland Empire.