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KJL LAW, Lawyer
Category: Bankruptcy Law
Satisfied Customers: 1530
Experience:  Attorney at law Office of KJLLAW
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We have a home in North Carolina and are wondering if it would

Customer Question

We have a home in North Carolina and are wondering if it would be exempt in a bankruptcy filing? We have a 160,000 mortgage on a home worth @260,000. It's in both husband and wife's name.
Submitted: 1 year ago.
Category: Bankruptcy Law
Expert:  KJL LAW replied 1 year ago.
Good afternoon. Do you reside in the house as your primary residence?
Customer: replied 1 year ago.
Customer: replied 1 year ago.
Customer: replied 1 year ago.
hello, have we been disconnected?
Expert:  KJL LAW replied 1 year ago.
Good Afternoon. The system is slow today. Under North Carolina Law each resident is allowed to exempt (protect or withhold) from creditors, up to $35,000.00 equity in their residence, or if you are married the exemption doubles to $70,000.00. Remember, equity is the difference between the value of the property and what is owed on the property. You have $1000,000 equity in your house, but generally the amount is capped at $70,000.00, if owned jointly. Also, if you are 65 or older then the exemption is $60,00 or $120,000.
I hope this helps with your question.
Customer: replied 1 year ago.
So I have to come up with 30,000 to pay creditors or sell my house to pay the difference?
Customer: replied 1 year ago.
in other words, if I don't have the 30grand, the judge would more than likely make us sell the home to make up the difference. Is that correct?
Expert:  KJL LAW replied 1 year ago.
If you file a chapter 7, the trustee may consider the "equity" in your home too small and may still abandon your home even if it has a small amount or nonexempt equity. The trustee in the bankruptcy incurs costs to sell your home and gets a commission from the sale. However, if the amount of nonexempt equity is not enough to cover these costs, there will be nothing left to distribute to creditors. In that case, your home will not be worth selling. Also, keep in mind that if the trustee sells your home, he or she must pay you an amount equal to your exempt equity. So for the amounts we are looking at they will probably not sell the house.
Expert:  KJL LAW replied 1 year ago.
If you have any additional questions please ask. If not, please rate for tracking and credit purposes.
Expert:  KJL LAW replied 1 year ago.
Please let me know if you have any additional questions.