Keeping Your Home in Bankruptcy: What You Need to Know
If you’re facing bankruptcy in Ohio, your house might be your biggest worry. Here’s the straightforward scoop on home retention under Chapter 7.
Home Protection Basics
Ohio gives homeowners a safety net. You can protect up to $155,675 in home equity. How do you calculate this? Take your home’s current value and subtract what you still owe on the mortgage and any existing liens.
Key Survival Points
Money Matters
Paying your mortgage isn’t optional. Bankruptcy wipes out many debts, but it doesn’t magically make your mortgage disappear. You’ll still need to keep up with payments if you want to keep the house.
Equity Scenarios
Let’s break this down:
- Suppose your home equity is $155,675 or less. Good news! You’ll likely keep your home.
- If your home equity goes over $155,675, Watch out. The bankruptcy trustee might start looking at selling your property, though you’ll get back the protected amount.
Protecting Yourself
Two smart moves to consider:
- Reaffirmation Agreement: In this agreement, you promise the bank you’ll keep paying the mortgage. This can help you keep your home.
- Chapter 13 Option: If Chapter 7 feels too risky, this alternative might give you more breathing room.
The Most Important Advice
Nothing beats talking to a local bankruptcy lawyer who knows Ohio’s rules. Every situation is unique, and what works for one person might not work for another.
Important Note: Laws change. What’s true today might not be true tomorrow. Always double-check the current rules.
Legal Disclaimer: This isn’t official legal advice. It’s general information to help you understand the basics.
