Bankruptcy is an unsettling topic and comes with a lot of questions and uncertainty. For most people, their home is their biggest asset, and bankruptcy is the topic the legal staff at Mark Briden Law in Redding, CA, is asked about the most. A home is an essential part of the well-being of families, and the benefits of bankruptcy are hard to recognize if you stand to lose it. Both Chapter 7 and Chapter 13 bankruptcy have the opportunity where you can keep your home, but it’s all conditional and dependent on what creditors seek.

Chapter 13 Bankruptcy

If you’re already at risk of losing your home through foreclosure, Chapter 13 bankruptcy is your best option. While it doesn’t wipe away the mortgage and other debts you hold, it puts an immediate freeze on any attempts lenders make to seize the property. Going forward, you can keep your home—so long as they don’t have the freeze lifted—by filing for Chapter 13 bankruptcy and creating a repayment plan. This still means you’ll have to cover your mortgage loan but on a more reasonable timeline. If you have the ability to eventually pay off your debts, consider Chapter 13 as a first option.

Chapter 7 Bankruptcy

The benefit of Chapter 7 bankruptcy is that it wipes the slate clean. However, the tradeoff is that nearly all of your assets can be seized to repay creditors—including your home. When you file for Chapter 7, a bankruptcy estate is created, and a trustee is designated. They hold control over all of your assets. If your mortgage is worth more than your home’s market value, they likely won’t sell your home. If possible, you can also attempt to keep paying your mortgage to maintain ownership. None of these rules are written in stone though, making Chapter 7 a much greater risk for homeowners.

If you’re looking for debt solutions, turn to the legal team at Mark Briden Law. They offer comprehensive bankruptcy guidance and will help you find a favorable solution to your financial troubles. Call (530) 222-1664 to schedule a free over-the-phone or in-person consultation. You can also speak with their staff about the payment plans they provide.