Will I lose my rental home if I file for a chapter 13 bankruptcy? 19 Answers as of June 02, 2013

I do not want to lost my rental home in Mexico. I am really worried that I will lose this asset if I file for bankruptcy. This home is something that gives me some kind of income, although it is not stable. Can I keep this exempt in a chapter 13 bankruptcy?

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Law Office of Nanina Takla
Law Office of Nanina Takla | Nanina Takla
You can't keep your rental home "exempt", but if the total amount that you pay through your chapter 13 plan is more than the value (as in equity) of your rental plus any other non-exempt property, then you should be able to keep the rental.
Answer Applies to: Oregon
Replied: 2/23/2012
Yahima Suarez, A Law Firm, PL | YAHIMA SUAREZ
This property will not be exempt but may be worked out under the plan. You should review your income, assets and debts with an attorney to let you know if you qualify for a chapter 13 bankruptcy and what are your real options before you file. A chapter 13 is a financial restructure and is not as easy as a chapter 7. The above is only general information and shall not be construed as legal advice. It is always recommend you consult with an attorney to review all the details of your case.
Answer Applies to: Florida
Replied: 2/20/2012
Ipson Law Firm, PLLC
Ipson Law Firm, PLLC | Michael Ipson
*Chapter 13 bankruptcies do not require the liquidation of property* as Ch 7 bankruptcy when property is unable to be exempted. Instead, Chapter 13 bankruptcies are funded by the monthly payments filing debtors make to their Ch 13 plans. Personal and real property is not subject to liquidation (seizing and selling off of property by the Trustee assigned to a Chapter 7 case by the court) in a Chapter 13 at all. That does not mean, however, that it is always possible to retain a second home or second piece of real estate in a Chapter 13, particularly if it is a home for which you are making mortgage or other payments. The Chapter 13 Trustees, whose approval is required for the bankruptcy courts confirmation of a new Chapter 13 Plan, will require the surrender of real estate that is not your primary residence and which is a drag on the bankruptcy estate, which is the legal estate created with the filing of a bankruptcy petition, which contains everything your own, everything you owe, and everything you are owed, other than exempted property. A real property is a drag on the bankruptcy estate if, quite simply, it costs more money than it brings in. That is, if you own a rental home which costs $1000/month in mortgage payments, requires $50/month in maintenance, and for which you must pay an average of $100/month in property taxes, this home is costing the estate $1,150/month. If you are renting that house out for less than $1,150/month, it is a financial drag on the bankruptcy estate, it is *costing money*. In this situation you could lose your rental home.
Answer Applies to: Utah
Replied: 2/20/2012
The Law Office of Darren Aronow, PC
The Law Office of Darren Aronow, PC | Darren Aronow
If you are paying 100% plan to trustee then they will not bother your 2nd home.
Answer Applies to: New York
Replied: 2/20/2012
J.M. Cook, P.A. | J.M. Cook
You probably will not have sufficient exemptions to exempt this property.
Answer Applies to: North Carolina
Replied: 2/20/2012
    Janet A. Lawson Bankruptcy Attorney
    Janet A. Lawson Bankruptcy Attorney | Janet Lawson
    Do not file a case by yourself if you have assets. See a lawyer.
    Answer Applies to: California
    Replied: 2/20/2012
    Bankruptcy Law office of Bill Rubendall
    Bankruptcy Law office of Bill Rubendall | William M. Rubendall
    In chapter 13 you keep your assets. You need to pass the liquidation test. This means that you have to pay creditors as much as they would receive in chapter 7 liquidation.
    Answer Applies to: California
    Replied: 2/17/2012
    The Law Offices of Kristy Qiu
    The Law Offices of Kristy Qiu | Mengjun Qiu
    No it will not be lost.
    Answer Applies to: Florida
    Replied: 6/2/2013
    Steven Harrell, Attorney at Law | Waymon Steven Harrell
    Rental property cannot be exempted in a Chapter 13 or a Chapter 7 proceeding, because it is not your primary residence. Is the rental property necessary for you to maintain plan payments in a Chapter 13 case? If the answer is yes, then keeping your rental property is possible. If the answer is no, then the house should probably be surrendered.
    Answer Applies to: Georgia
    Replied: 2/17/2012
    Bodow Law Firm PLLC | Ted Araujo
    Maybe, and yes. It depends on the amount of equity and the other property you have that uses up the exemptions. We have to know all of the assets and other issues related to property, not just this one property. And, even if the equity is not protected you could protect it in a Chapter 13. Again, it depends on a number of factors having to do with the amount of equity. If the rental property is worth about what you owe on it you should be able to keep it without any other complications.
    Answer Applies to: New York
    Replied: 2/17/2012
    Rhonda R. Werner Schultz, PL
    Rhonda R. Werner Schultz, PL | Rhonda R. Werner Schultz
    So long as you can pay back debt in your Chapter 13 plan that is equal to the value of any equity you have in the home you will be able to exempt the property. For example, if you have $15,000 of equity in the Mexican home you will be required to pay $15,000 of debt in your Chapter 13 plan. If your debt is less than the value of the equity in the home, you will not likely be able to exempt the property, unless it qualifies under the standard exemptions. You should consult with an attorney about all of your assets and whether retaining the home is feasible if you file bankruptcy.
    Answer Applies to: Wisconsin
    Replied: 2/17/2012
    Law Office of Michael Johnson
    Law Office of Michael Johnson | Michael Johnson
    No but you may not lose it either. You should consult with an attorney.
    Answer Applies to: Florida
    Replied: 2/17/2012
    Law Offices of Robert P. Taylor
    Law Offices of Robert P. Taylor | Robert P. Taylor
    You will be able to keep it if you pay as much to the court as the court would get if they sold the real estate. You need to speak with an attorney.
    Answer Applies to: California
    Replied: 2/17/2012
    Ashman Law Office
    Ashman Law Office | Glen Edward Ashman
    You totally misunderstand Chapter 13. Get a lawyer and don't screw up by acting pro se. Exempting it has NOTHING to do with Chapter 13. Whether you can keep it depends on the creative drafting of a plan and you will not get the answer in any form.
    Answer Applies to: Georgia
    Replied: 2/17/2012
    Diefer Law Group, P.C.
    Diefer Law Group, P.C. | Abel Fernandez
    It depends on how much equity you have in the home. There are limits of what you can protect. If the equity exceeds what you are able to protect, then you would not be able to protect the entire amount and would have to buy back the excess equity from the court.
    Answer Applies to: California
    Replied: 2/17/2012
    Weber Law Firm, P.C.
    Weber Law Firm, P.C. | William Weber
    No. You will probably lose the rent house in a Chapter 7 bankruptcy unless there is a loan against the house and you has very little or no equity.
    Answer Applies to: Texas
    Replied: 2/17/2012
    Law offices of John P. Brooke | John Brooke
    It depends if your chapter 13 is a 100% payment plan. You would not lose it in a chapter 13 but you may have to pay back its value to your creditors in a chapter 13.
    Answer Applies to: New York
    Replied: 2/17/2012
    Ursula G. Barrios Law
    Ursula G. Barrios Law | Guillermo Machado
    You can keep it if exemptions allow and if they do not, you can still keep it if you pay the unprotected amount of equity to your creditors. If it generates income, you should and can keep it through bankruptcy.
    Answer Applies to: California
    Replied: 2/16/2012
    Bordeaux Law, P.C.
    Bordeaux Law, P.C. | Clifford Bordeaux
    You can usually keep assets in Chapter 13 if you agree to pay your unsecured creditors the value of any nonexempt assets. You need to consult with a bankruptcy attorney and be prepared to disclose the value of the property, the value of your other assets and information about your income and expenses. It is necessary to know the details in order to determine whether you would be able to keep the property.
    Answer Applies to: California
    Replied: 2/16/2012
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