Bankruptcy Law Questions? Ask a Bankruptcy Lawyer Now.
Your goal is to hope and push for the passage of HR 1106, which is currently stalled in the Senate Banking Committee. This bill would permit a bankrutpcy judge to force lenders to accept lower principal balances on their loans as part of a Chapter 13 bankruptcy. And, since you apparently have income, and you want to save your home, you would need Chapter 13 rather than Chapter 7, plus this new law to save your home.
There really is no other option (although there are loads of businesses pushing other options).
Terms and Conditions: By your continuing in this conversation with me, or by your clicking “Accept”, you are expressly agreeing to all of the following: (1) our communication is for entertainment purposes only; (2) you are not consulting me in my professional capacity as an attorney; (3) you do not seek to establish an attorney-client relationship with me, nor do I with you; (4) you will not rely on anything I say and you will obtain appropriate legal counsel via a traditional/office consultation with an attorney licensed to practice in the jurisdiction where your legal issue arises (and you may not use our communication to avoid taxpayer penalties imposed by the U.S. Dept. of Treasury); (5) by communicating with me in this public forum you are irrevocably waiving any right to privacy, confidentiality and attorney-client privilege concerning the matters discussed. You further separately declare that any payment made by you is not consideration for this contract, nor offered for any services rendered by me on your behalf, but rather is made in genuine admiration and respect for my desire to help others. If you do not agree with these terms and conditions, then you must advise me immediately.
The object of Ch. 13 is to spread your payments out so you don't lose any assets, and force any unsecured creditos to accept no more than they would receive were you to file Ch. 7 (total liquidation). Generally, retirement accounts are exempt from creditors, so you would keep that money. As far as future income goes, you have between 3-5 years to pay off the Ch. 13 plan, and if you succeed, then you are discharged from whatever debts remain, and you go forward from there.
If you can't make the payments, then you will either be dismissed from Ch. 13, because your actions were in bad faith, or converted to a Ch. 7 (or discharged directly from Ch. 13), which would liquidate all of your non-exempt assets.
For a discussion of the Ch. 13 rules you may want to pick up a copy of one or more of these publications: http://search.nolo.com/query.html?qt=bankruptcy&col=b2store.
DISCLAIMER: Answers from Experts on JustAnswer are not substitutes for the advice of an attorney. JustAnswer is a public forum and questions and responses are not private or confidential or protected by the attorney-client privilege. The Expert above is not your attorney, and the response above is not legal advice. You should not read this response to propose specific action or address specific circumstances, but only to give you a sense of general principles of law that might affect the situation you describe. Application of these general principles to particular circumstances must be done by a lawyer who has spoken with you in confidence, learned all relevant information, and explored various options. Before acting on these general principles, you should hire a lawyer licensed to practice law in the jurisdiction to which your question pertains.
The responses above are from individual Experts, not JustAnswer. The site and services are provided “as is”. To view the verified credential of an Expert, click on the “Verified” symbol in the Expert’s profile. This site is not for emergency questions which should be directed immediately by telephone or in-person to qualified professionals. Please carefully read the Terms of Service (last updated February 8, 2012).