Can filing chapter 7 or 13 eliminate the debt or will we be forced to sell the house anyway if equity exceeds federal homestead exception? 25 Answers as of May 02, 2014

We lost a civil case for damages (no negligence, no fraud, no illegal substances and no under influence) and there is a judgment against us. We appealed.

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Law Office of Marlin Branstetter
Law Office of Marlin Branstetter | Marlin Branstetter
If you have equity in your home above what you are allowed to protect in bankruptcy your home could be sold. In most cases the trustee will allow you to purchase the excess equity if you can raise the funds. You should contact a bankruptcy attorney as some states do not use the federal exemptions (California for example). You may be able to protect more of your equity under state law.
Answer Applies to: California
Replied: 5/2/2014
Law Office of Susan G. Taylor
Law Office of Susan G. Taylor | Susan G. Taylor
Need more details, but if you've lived in Texas at least 2 years, you can utilize the Texas exemption scheme.
Answer Applies to: Texas
Replied: 5/2/2014
Law Office of Andrellos Mitchell
Law Office of Andrellos Mitchell | Andrellos Mitchell
A Chapter 13 is a repayment plan. It is for wage earners who usually on a home who want to reorganize their debt. This case sounds more like a Chapter 7. Chapter 7 discharges most unsecured debt. There are exceptions such as student loans. You need to talk to a lawyer about your specific case.
Answer Applies to: District of Columbia
Replied: 5/1/2014
Stephens Gourley & Bywater | David A. Stephens
The bankruptcy eliminates debts not assets. IF the house is exempt then the judgment creditor cannot touch it. If it is not exempt, then the judgment creditor can execute on the non-exempt portion.
Answer Applies to: Nevada
Replied: 4/30/2014
Eranthe Law Firm
Eranthe Law Firm | Cate Eranthe
1. California does not use Federal exemptions. You'll need to see the California Civil Procedure 704 Code exemptions. 2. If you have a house, property, potential lawsuits, tax refunds due, checking accounts, etc. etc. you should see a local knowledgeable bankruptcy attorney. Why would you fail to get specific advice and risk your home or other property? You aren't going to get much help in an online forum. 3. Bankruptcy law depends on the Federal Bankruptcy Code and laws, California State law, Local Rules and local customs. It is complex and fact specific (meaning to give you advice requires an evaluation of ALL your facts). Please take your information to a local knowledgeable bankruptcy attorney for help.
Answer Applies to: California
Replied: 4/30/2014
    Ronald K. Nims LLC | Ronald K. Nims
    The federal homestead exemption is irrelevant to Ohio. Ohio has adopted it's own exemptions and doesn't use the Federal ones. The Ohio homestead exemption is $132,900 per person (remember, if the home is only in one spouse's name, then you lose the exemption of the other spouse). Civil cases are dischargeable but you need to consider if you'll be Chapter 7 or Chapter 13. That's based on income.
    Answer Applies to: Ohio
    Replied: 4/30/2014
    EDWARD P RUSSELL | EDWARD P RUSSELL
    A bankruptcy discharge would discharge all debts including the one which is the basis for the judgment against you.
    Answer Applies to: Minnesota
    Replied: 4/30/2014
    GARCIA & GONZALES, P.C.
    GARCIA & GONZALES, P.C. | Richard N. Gonzales
    There is more flexibility in a Chapter 13, assuming you qualify. It's too much detail to get into here. You need to meet fact-to-face with an experienced bankruptcy attorney for guidance. Good question!
    Answer Applies to: Colorado
    Replied: 4/30/2014
    Garner Law Office
    Garner Law Office | Daniel Garner
    The Oregon homestead exemption exceeds the federal homestead exemption, so make sure you investigate all state exemptions as well as federal ones. The non-exempt assets must be paid for or surrendered in any bankruptcy, but the advantage of a Chapter 13 is it lets you pay for them over a longer period of time, up to 5 years. The value of your non-exempt assets becomes the "best interest number" which sets the minimum amount you have to pay toward your debts in a Chapter 13. So if you have a regular source of income, that is the way to go if you want to keep your house.
    Answer Applies to: Oregon
    Replied: 4/30/2014
    Baner & Associates | Sandra M Baner
    You may be able to use state exemtions to protect the equity in your home. If not, you could still file a Chapter 13 and pay to creditors, through your Plan, the nonexempt equity over 3 to 5 years.
    Answer Applies to: Wisconsin
    Replied: 4/30/2014
    Graves Law Firm
    Graves Law Firm | Steve Graves
    Your question doesn't contain enough information for a definitive answer, but if you're in Texas you can take advantage of the Texas homestead exemption? It's unlimited if you qualify. See a bankruptcy lawyer. Good luck.
    Answer Applies to: Texas
    Replied: 4/30/2014
    Law Office of Lynnmarie A. Johnson
    Law Office of Lynnmarie A. Johnson | Lynnmarie Johnson
    You won't be forced to sell your house but you may have to pay an amount equal to the equity which exceeds the exemption. Consult a bankruptcy attorney and make sure the debt can be discharged and they should be able to help you decide which way to go.
    Answer Applies to: Michigan
    Replied: 4/30/2014
    Janet A. Lawson Bankruptcy Attorney
    Janet A. Lawson Bankruptcy Attorney | Janet Lawson
    When equity exceeds value and homestead, file a Chapter 13 you have to pay the value of the excess equity. Depending on the size of the judgement, you might have to file Chapter 11. There are debt limits in Chapter 13. You need to consult with a lawyer, there might be a state homestead exemption available to you that is more generous than the federal one. Do take this on on your own.
    Answer Applies to: California
    Replied: 4/30/2014
    A Fresh Start
    A Fresh Start | Dorothy G Bunce
    If you equity exceeds the federal exemption amounts but you want to keep your house, why not consider a Chapter 13. Hiring an experienced Chapter 13 attorney can let you make monthly payments over 5 years to pay the creditors the unprotected equity in your property without the need to sell.
    Answer Applies to: Nevada
    Replied: 4/30/2014
    Hicks, Massey & Gardner, LLP
    Hicks, Massey & Gardner, LLP | Robert M. Gardner, Jr.
    If the judgement has been perfected correctly, it may attach to the house and change the equity. Sit down with a bankruptcy attorney for a free consultation and get specific answers to your issues.
    Answer Applies to: Georgia
    Replied: 4/30/2014
    The Troglin Firm | William M. Troglin
    Georgia opted out of the federal exemptions for bankruptcy and uses state exemptions under O.C.G.A. Section 44-13-100 and its subsections. The homestead exemption for husband and wife is $43,000.00. If your equity exceeds the available exemption, you can file a Chapter 13 with a composition plan where you pay your unsecured creditors less than 100 cents on the dollar and keep all of your real and personal property. The basic requirement is that the unsecured creditors must be paid an amount equal to the non-exempt equity in all real and personal property.
    Answer Applies to: Georgia
    Replied: 4/30/2014
    Meister & McCracken Law Firm, PLLC | Joanne M. McCracken
    You should not be forced to sell your house. Your case has a number of variables that should be addressed during a consultation with a bankruptcy attorney. That will allow you to get information as it applies just to your situation.
    Answer Applies to: Arkansas
    Replied: 4/30/2014
    Hayward, Parker, O'Leary & Pinsky, Esqs.
    Hayward, Parker, O'Leary & Pinsky, Esqs. | Michael O'Leary
    A New York debtor can also claim the NYS exemptions, where the homestead exemption is much more generous than the federal exemption. Depending upon which county you live in, the NYS homestead exemption can range from $75,000.00 in Sullivan County to $150,000.00 in the 5 boroughs of New York and in Westchester, Rockland and Putnam Counties. If the judgment is filed in the County where your home is located it will also constitute a lien on your residence, which can be avoided pursuant to a Bankruptcy Court Order under 522(f). You should contact competent bankruptcy counsel to discuss these matters.
    Answer Applies to: New York
    Replied: 4/30/2014
    Musilli Brennan Associates PLLC
    Musilli Brennan Associates PLLC | John F Brennan
    You should speak with your attorney, or preferably a bankruptcy practitioner to explore your various options.
    Answer Applies to: Michigan
    Replied: 4/30/2014
    Cameron Totten | Cameron Totten
    With a chapter 13, you can keep your house as long as you comply with all of the terms of the plan. With a chapter 7, the trustee has the right to sell your house and give the proceeds to the creditors. The trustee often evaluates whether it would be cost effective to sell assets, I.,e., will the cost of sale be roughly same or greater than the proceeds of the sale.
    Answer Applies to: California
    Replied: 4/30/2014
    Scott Goldstein | Scott Goldstein
    In Chapter 7, if the equity exceeds the exemption after costs of sale, the Trustee will sell the house. Whether state or federal applies depends on your state. In Chapter 13, you will have to pay the equity in cash to the Trustee to pay your unsecured creditors.
    Answer Applies to: New Jersey
    Replied: 4/30/2014
    Law Offices of Linda Rose Fessler | Linda Fessler
    If you file a chapter 7 and the judgement is not for personal injury, it will take away the debt. However, if you have too much equity in house the trustee will sell it.
    Answer Applies to: California
    Replied: 4/30/2014
    Law Office of Stuart M. Nachbar, P.C.
    Law Office of Stuart M. Nachbar, P.C. | Stuart M. Nachbar
    In NJ, if the house is jointly owned, the federal exemption is about 43,000. If you have more equity than that, the Trustee may offer you a buy-out (which means that you pay him to buy back your interest in the Property). There are several other issues that would need to be looked into, so consult with Bankruptcy Counsel in your state. (Please note that I say in your state, as we are not told where the question arises from, and my answer is NJ specific.)
    Answer Applies to: New Jersey
    Replied: 4/30/2014
    Law Offices of Eric W. I. Anglin
    Law Offices of Eric W. I. Anglin | Eric W. I. Anglin
    You may file bankruptcy to seek to discharge the debts associated with a civil judgment. The chapter of bankruptcy that you file will depend on your non-exempt assets as well as your income and expenses. You should consult with an attorney as he/she will need to have the judgment avoided so it isn't attached to your real estate.
    Answer Applies to: Indiana
    Replied: 4/30/2014
    John Ceci PLLC
    John Ceci PLLC | John Ceci
    The short (incomplete) answer to your question is maybe. If you only have a little excess equity you could very well keep your home and simply pay the difference to the trustee. If there is a lot of equity then you could find yourself in a situation where you have to walk away. However whatever equity you can protect is still yours to keep. You should strongly consider hiring an attorney to handle your bankruptcy for you.
    Answer Applies to: Michigan
    Replied: 4/30/2014
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