Are you weighing your options between bankruptcy and trying to get a home loan? If so, take a second to read further -- in some cases, a bankruptcy will lock you into a path that you may not necessarily want to follow.
In essence, the most important thing here is whether or not you want to keep your home. If you want to fight for it, then the most important thing to know is that you should not declare Chapter 7 bankruptcy. If you declare Chapter 7 and the loan is discharged (assuming the home loan is among the listed assets), you are no longer responsible for the loan or the property, thus you can't attempt to modify it. You can, however, attempt to modify a loan that you get after Chapter 7.
What happens if you declare Chapter 13 bankruptcy? Then things change, as Chapter 13 is all about making debt payable with a structured plan. Part of that plan may actually include a modified home loan, though that's simply speculation until you actually go through the process.
The more important thing to consider is timing. If you feel like you can make payments with some restructured help and you want to try and keep your home, absolutely try to get a loan modification BEFORE you declare any type of bankruptcy. It's the whole look-before-you-leap thing; consider your options before taking the plunge into bankruptcy, otherwise you might find that it handcuffs you more than you'd like.
The views published here are the opinions of the writer and are not a substitute for legal counsel.
Israel Gonzalez
Real Estate Broker-Hollister CA
831-636-8858
www.nicereohomes.com
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