Can I Keep My House if I File Bankruptcy in Alabama?

holding house key to his clientAre you filing for bankruptcy in Alabama and wondering if you can keep your house? In Alabama, you are able to protect up to $16,450 of equity per person in your residence. Your residence may be a mobile home, house, or something similar that is on up to 160 acres. If you are considering debt consolidation in Mobile AL, it is important that you hire an attorney affiliated with Loris Bankruptcy Law Firm to assist you.

Qualifying for Bankruptcy in Alabama

If you have never filed for bankruptcy chapter 7 in Mobile AL, you will meet the qualifications. Otherwise, you can check whether enough time has passed to deem you eligible to file again. The waiting period will depend on the chapter that you filed previously and the chapter that you plan on filing this time around. Additionally, you will need to meet certain chapter qualifications for Mobile, Alabama debt consolidation.

Chapter 7 Bankruptcy

If the gross income of your family is lower than the median income for the same size family in the state of Alabama, you will qualify for Chapter 7. You can easily add all of your gross income that you earned during the last six months, then multiply it by two. You can then compare the figure to the income charts that are listed on the U.S. Trustee’s website.

Chapter 13 Bankruptcy

This can be a more expensive option, since you will have to pay for the extra benefits. In order to qualify, you will have to pay the larger of your disposable income, the value of nonexempt property, or your priority non-dischargeable debt.

Keeping Your Home After Filing Bankruptcy

With Chapter 7 bankruptcy, most of your unsecured debts will be liquidated, including personal loans, credit card debt, and medical bills. This means that you will get to keep your home and car. Once this debt has been eliminated, you should be able to make your mortgage payments a lot easier.

If you know you will be filing for bankruptcy and want to keep your home, you can see if your mortgage lender will be willing to work with you to modify your mortgage agreement so you can catch up with your payments.

With Chapter 13 bankruptcy, AL Mobile attorneys will explain to you that you will also be able to keep your house. Both the creditors and the bank will make a decision on a repayment plan that can take anywhere between three and five years. However, your assets will not be sold off. Your unsecured debt will be discharged once the plan is complete.

With Chapter 13 bankruptcy, if you have fallen behind on your mortgage payments, the plan will work out how you pay the past due payments over the next three to five years. However, you must also make the current monthly payments.

How an Attorney Can Help

If you are looking for a bankruptcy attorney in Baldwin County, you should know that hiring one has many benefits. A bankruptcy lawyer will help you with all of the following:

  • Determine when it is time to file
  • Qualify you for the chapter of your choice
  • Help you keep the property you want
  • Make sure that you don’t run into fraud or other issues
  • Explain when you can stop paying the bills that will be erased in your case

You can also expect to have creditors hunting you down until your bankruptcy has been filed by an Alabama bankruptcy lawyer. The best thing to do is ignore them, since informing them about your bankruptcy can encourage them to take more steps to collect the debt you owe.