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cfortunato, Attorney
Category: Bankruptcy Law
Satisfied Customers: 8023
Experience:  Bankruptcy professor.
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I am in the third year of a ten year mortgage on my home.

Resolved Question:

I am in the third year of a ten year mortgage on my home. If I file for personal bankruptcy, do I have to give up the house?
Submitted: 6 years ago.
Category: Bankruptcy Law
Expert:  cfortunato replied 6 years ago.
Hi JACustomer,
1) What is the current market value of the home? (How much could the house sell for now?)
2) What is the balance on the mortgage?
3) Are you 65 or older?
Customer: replied 6 years ago.
40,00 is the tax value, not sure about the market value.
34,794 is the balance due.
I am 62
Expert:  cfortunato replied 6 years ago.

Assuming the tax value is an estimate of what the house could sell for, your home has only around $5,000 equity. This means you would be allowed to keep your home if you file a Bankruptcy (as long as you continue to make the mortgage payments), as you are allowed to keep one home with up to $35,000 equity. (Equity is the market value minus the balance on the mortgage.)


I think this is what you wanted to know. If not, please let me know.
Thank you!

Customer: replied 6 years ago.
I own 49 percent stock in a corporation that was disovled a few years ago. The business has continued to operate since then. It is not profitable. In fact, it has operated at a loss for each of the 26 years in operation. The assets are 2 vehicles valued at about 8,000, approximately 50,000 in non-liquidable merchandise, 13,000 in cash, and approximately 5,000 in equipment.

How does that figure into a personal bankruptcy?
Expert:  cfortunato replied 6 years ago.

Is the business now a partnership? Who pays the loss each year?

Customer: replied 6 years ago.
No, it has continued to operate as a corporation, needing to get the tax reports up to date so that it can be reinstated.

Also, I have about 17,000 in credit card debt. How much of that would be forgiven?
Expert:  cfortunato replied 6 years ago.

1) There is no exemption for shares of corporations owned by a debtor. This means if you file - and if the Bankruptcy trustee thinks it worthwhile - he can try to sell your interest in the corporation and/or your share of the corporate assets.

2) There is no limit to the amount of debt you can have discharged in a Bankruptcy.

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