Can I file bankruptcy if my home is paid for and how does it work if I own a few stocks for retirement and a small IRA? 23 Answers as of August 21, 2014

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Law Office of William Stoddard | William Stoddard
You can always file bankruptcy if you need a fresh start, but keep in mind there are two type of bankruptcies for consumers, Chapter 7, which is a liquidation bankruptcy and Chapter 13 which is reorganization bankruptcy. In 7 you offer to put your assets on the line seeking a discharge from debts you cannot pay. You are allowed exemptions (the right to keep a certain amount of property for the fresh start. Under Fed exemptions you can keep 15K in real property or a husband and wife 30K. Under state exemptions you can keep up to 40K in real estate. But the two exemption systems have various strengths and weaknesses. For the most part a couple keeps about. 60k in value of property. This sounds like not enough for you. The retirement accounts do not count, you would exempt all of them. But the point is you may best file a Chapter 13 and pay what you can over 5 years, even if that is only 20% of the total debt, but after 5 years you are done, paid in full.
Answer Applies to: Washington
Replied: 8/21/2014
Rhymer Law Firm
Rhymer Law Firm | William Rhymer
It depends on the value of those things. I would suggest you get a free consultation from an experienced bankruptcy attorney.
Answer Applies to: Georgia
Replied: 8/18/2014
The Law Office of M Grater LLC
The Law Office of M Grater LLC | Mark O. Grater
It depends on the value of your home and whether or not you have enough exemption available to cover the things you own.
Answer Applies to: Connecticut
Replied: 8/15/2014
Musilli Brennan Associates PLLC
Musilli Brennan Associates PLLC | John F Brennan
See an attorney, bankruptcy may not be your best option.
Answer Applies to: Michigan
Replied: 8/15/2014
Mauritz Van Niekerk, Attorneys at Law
Mauritz Van Niekerk, Attorneys at Law | Christiaan van Niekerk
If your home is under the exempt amount that is fine also the Ira but the stocks you will loose.
Answer Applies to: New York
Replied: 8/15/2014
    Tokarska Law Center
    Tokarska Law Center | Kathryn U. Tokarska
    Of course you can file for bankruptcy but I think the more important question is what the result would be, will you be able to keep all of your property (home, etc). You need to consult with a bankruptcy attorney to find out if filing for bankruptcy is the right decision because answering that question requires a lot more facts about your financial situation.
    Answer Applies to: California
    Replied: 8/15/2014
    Law Offices of Linda Rose Fessler | Linda Fessler
    You cannot file because they will sell your home to pay your debts.
    Answer Applies to: California
    Replied: 8/15/2014
    LAW OFFICE OF DAVID A. KUBAT
    LAW OFFICE OF DAVID A. KUBAT | DAVID A. KUBAT
    Yes, you can file either a chapter 7 or chapter 13 bankruptcy, depending on how much your house would sell for right now. If your house value is not within the homestead exemption you can claim in bankruptcy, you could lose it in a Chapter 13 bankruptcy, but it would be very unlikely in a chapter 13. Please consult a local bankruptcy attorney in your area to discuss your situation. You don't want to guess about this and be wrong.
    Answer Applies to: Washington
    Replied: 8/14/2014
    GARCIA & GONZALES, P.C.
    GARCIA & GONZALES, P.C. | Richard N. Gonzales
    There are a lot of variables. It depends. I would contact a very experienced bankruptcy lawyer, and pay him or her for one hour of their time. You do not want to make any mistakes. The two big variables are, a) What is the home worth, and b) In what state do you live (you will have to apply the exemption laws of the state you reside). Do not be penny wise and pound foolish - you have too much to lose!
    Answer Applies to: Colorado
    Replied: 8/14/2014
    EDWARD P RUSSELL | EDWARD P RUSSELL
    Since the Federal homestead exemption allows for only about $22,000 protection, $44,000 for husband wife, you will probably have to rely on the state exemption. In Minnesota that will protect about $350,000 in equity in your home. The IRA should be able to be protected. The stocks may be a problem but you could pay the trustee something for them.
    Answer Applies to: Minnesota
    Replied: 8/14/2014
    Deborah F Bowinski, Attorney & Counselor at Law | Debby Bowinski
    You MUST consult with an attorney who can evaluate the exemptions to which you are entitled against the values of your assets. In many, but not all states, significant equity in a home can be very problematic in bankruptcy. The same is true of investments. Bankruptcy is designed to aid folks who have no real ability to repay their debts, not those who choose to use their resources for other purposes. Be careful, and make sure you have the knowledge and understanding necessary to evaluate your specific situation. Here in Colorado, you get to protect either $60,000 or $90,000 of equity in your primary residence, and you get to protect IRS-qualified retirement accounts, but there is no protection afforded at all for other types of investments or cash-equivalents. Other states have different exemptions schemes.
    Answer Applies to: Colorado
    Replied: 8/14/2014
    Stuart Jon Bierman  Attorney at Law
    Stuart Jon Bierman Attorney at Law | Stuart Jon Bierman
    If you need to consider filing for bankruptcy but your home is fully paid for then that raises several complications. You should talk with an attorney and provide more details about your particular situation. Once the attorney has those then he or she can better advise you about your options.
    Answer Applies to: New Jersey
    Replied: 8/14/2014
    Ronald K. Nims LLC | Ronald K. Nims
    In Ohio, there is a $132,000 per person exemption for equity in your home - so for a married couple the exemption is $264,000. If your home is worth less than that, then none of your equity would be at risk in a Chapter 7. Investments, like your stocks, aren't exempt. You would probably lose them in a bankruptcy, you should consult an attorney for advice on bankruptcy planning to avoid this. Tax exempt retirement funds, including IRAs are exempt, so they would also be protected.
    Answer Applies to: Ohio
    Replied: 8/14/2014
    A Fresh Start
    A Fresh Start | Dorothy G Bunce
    Owning a home doesn't prevent you from filing a bankruptcy, but I presume you are wondering if you might lose your home if you did file bankruptcy. Same with your stocks & IRA account. It would have helped if you had indicated how much your house, stock and IRA are worth & how long you have owned the house. Laws called exemptions, which vary widely from state to state, will determine whether or not any of your property is at risk.
    Answer Applies to: Nevada
    Replied: 8/14/2014
    Janet A. Lawson Bankruptcy Attorney
    Janet A. Lawson Bankruptcy Attorney | Janet Lawson
    You need to see a lawyer to determine your homestead exemption. Every state is different. Do not file without consulting a lawyer. You could lose the house if you are not careful.
    Answer Applies to: California
    Replied: 8/14/2014
    The Law Office of Darren Aronow, PC
    The Law Office of Darren Aronow, PC | Darren Aronow
    That depends what county you reside in. For example, in Nassau County the debtors get a $150,000 homestead exemption so that if there is $150,000 or less then the house is fine ($300,000 if you are married and both on title). If you have equity over and above your exemption amount then you would be at risk of the trustee coming after you for judgment for that amount. Also, the IRA is exempt but any stocks would not be exempt if you used your homestead exemption.
    Answer Applies to: New York
    Replied: 8/14/2014
    Goldberg, Scudieri & Lidenberg, P.C. | Alan J. Goldberg, Esq
    Your retirement funds are exempt and in New York the first $150,000.00 of your home value would be exempt. There are a number of options which require the advice of a skilled attorney.
    Answer Applies to: New York
    Replied: 8/14/2014
    Garner Law Office
    Garner Law Office | Daniel Garner
    If you have more assets than you can exempt under applicable state or federal rules, a Chapter 13 is often the best way to go if you are struggling to pay your bills. That involves a repayment plan in which your monthly payment is based on your ability to pay, and the minimum you must pay during the plan is the value of your non-exempt assets. You would have up to 5 years to pay that amount on your debts, thus allowing you to keep your assets which otherwise would have to be liquidated in a Chapter 7 bankruptcy. If you complete your plan, then the remaining unsecured, non-priority debt is forgiven. You should talk with an experienced bankruptcy attorney to understand all your options.
    Answer Applies to: Oregon
    Replied: 8/14/2014
    Law Office of Stuart M. Nachbar, P.C.
    Law Office of Stuart M. Nachbar, P.C. | Stuart M. Nachbar
    This means that you have equity in your home and you will probably have to file a Chapter 13. The stocks are no issue as they are probably exempted out.
    Answer Applies to: New Jersey
    Replied: 8/14/2014
    The Law Offices of Kristy Qiu
    The Law Offices of Kristy Qiu | Mengjun Qiu
    IRA our anything related to requirement and is ERISA exempt is exempt in bankruptcy. Homestead exemption will help you keep your house, however, most states have a limitation on value that you can claim for this exemption, except Florida.
    Answer Applies to: Florida
    Replied: 8/14/2014
    Stittleburg Law Office
    Stittleburg Law Office | Bernd Stittleburg
    If you own your home free and clear, I would not recommend filing bankruptcy as you would put your home in jeopardy to be seized by the trustee to pay your debts. Any stocks you own would also be subject to potential seizure by a trustee. My suggestion is to find another way to pay your debts.
    Answer Applies to: Georgia
    Replied: 8/14/2014
    Steele, George, Schofield & Ramos, LLP
    Steele, George, Schofield & Ramos, LLP | Alan E. Ramos
    You really need to sit down and talk with an attorney. Depending on the value of your home and your age, it is possible that you could lose your home. Your stocks held for retirement, if not in an ERISA qualified plan, you could lose them as well. Assuming that your IRA is in an ERISA qualified retirement account, it would not be at risk. Again, you need someone to look at all of your facts (not just the facts presented in your question) and properly advise you on the best course of action for you to take (bankruptcy may not be your best avenue).
    Answer Applies to: California
    Replied: 8/14/2014
    Law Office of Barry R. Levine | Barry R. Levine, Esq.
    Make an appointment to see a bankruptcy attorney . . . all will be revealed.
    Answer Applies to: Massachusetts
    Replied: 8/14/2014
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