Clients call in about many different types of debt, but one type of debt that is usually the most important to our clients is their mortgage debt. Mortgage debt is usually the largest debt amount for most home owners. Filing for bankruptcy does not always mean that you will lose your home and wipe out your mortgage debt. Homestead exemptions allow you to keep your home if you have less than $75,000 of equity if you are single. Married couples can exempt $100,000 of equity, and if you are 65 or older, you can exempt $175,000 of home equity.
Keep in mind that if you keep your home, your mortgage will also be kept with it. Discharging secured debt is possible when you surrender the asset involved. You should not expect your mortgage to be discharged in your bankruptcy along with other unsecured debt because your mortgage is a secured debt. If you are interested in surrendering your home, you can get any deficiencies on the loan discharged after the home has been surrendered in the bankruptcy, but while you are in your home and if you plan to keep in, you should also plan to continue to make your current mortgage payment. Even if you are in an active bankruptcy, if you own an asset and plan to keep the asset, you should continue to pay any debt payments that you are scheduled to pay. You should not expect to discharge any debt for any type of secured debt like a home or automobile if you want to keep the asset in question.
Bankruptcy Law Professionals is a Southern California Bankruptcy Law Firm based in Orange County and Inland Empire. We have bankruptcy attorneys available at our offices in Riverside and Santa Ana. To schedule a consultation, contact us at 855 257-7671 to consult with an attorney in your area.