The most common concern people have when looking into filing for Bankruptcy is they do not want to lose their house. It is then generally shocking to people when I tell them that filing for bankruptcy will not force you to lose your house. Here is what you need to consider with regards to your house when filing for bankruptcy:
- If your mortgage payments are current, the secured lender holding the mortgage to your property cannot foreclose on your home. Keep your payments current and you can keep your home going forward.
- When filing for bankruptcy, a Trustee must calculate the equity in your property. Under a bankruptcy you would have to pay back that equity into the bankruptcy estate. Sometimes this can mean high repayments per month which may not be affordable in your budget. This is when a consumer proposal is likely a much more attractive option as it can lower the payment per month and stretch it over a longer time frame.
- A bankruptcy will eliminate almost all of your unsecured debt. This will generally free up a portion of your budget.
- Sometimes homeowners wish to move on from their current home. If you do surrender your home to the mortgage holder, any shortfall that remains after the mortgage holder sells your home can be included and eliminated under your bankruptcy.
If you are a homeowner struggling with debt and you were considering filing for bankruptcy, you can take comfort in knowing that keeping your house is very realistic and you have other debt solutions available as well. The best way to know what solution is best for you and what it may cost is by contacting a professional at Spergel by calling 310-4321, visiting our nearest location for a free consultation, or completing our free assessment form online.
Rob Kilner
Trustee in Bankruptcy
Rob is the Trustee in Bankruptcy overseeing our Barrie and Newmarket Offices. He is available Monday through Friday from 9am-5pm and is available for weeknight and weekend appointments. Feel free to contact him and he will be more than happy to help you with any question you may have.
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