The short answer to this frequently-asked question is: Yes, it is often possible to file for bankruptcy protection and keep your home.
One of the biggest misnomers about filing for bankruptcy is that the process results in losing all of your property and assets. As a result, some people shy away from the bankruptcy process because they are afraid of losing their homes, vehicles or personal property.
What they don’t know is that while Chapter 7 bankruptcy does involve liquidation, most property and assets are excluded from the liquidation process.
Liquidation refers to selling assets that have value in order to pay back as many creditors as possible. However, most people filing for Chapter 7 bankruptcy are broke and there are very few assets to liquidate, if any.
Even if you do have valuable assets such as a home, car, tools or retirement savings, these are often exempt from the liquidation process because the law considers them to be basic necessities.
In fact, for many people, it makes more sense to file for bankruptcy than to sell their home or dip into their retirement savings because bankruptcy can result in losing fewer assets.
Note: You also don’t need to worry about losing your property or assets if you file for Chapter 13 bankruptcy as this process does not involve liquidation.
You have more to lose by not filing
The bottom line is that you stand to lose more by not filing for bankruptcy through vehicle repossessions, foreclosures, wage or bank account garnishment, increased interest rates and late fees.
As soon as you file for bankruptcy, the court puts an automatic stay in place that prevents your creditors from coming after you or seizing your property.
For more information on both the Chapter 7 and Chapter 13 bankruptcy process, talk to an experienced attorney in your area. Or find out right now what you have to gain by filing for bankruptcy protection here.