Can I Keep My Home and Car if I File for Bankruptcy?

image of wallet being squeezedA common misunderstanding that people have about bankruptcy is that you cannot keep your home and car(s) if you file bankruptcy. In reality, most people who file for bankruptcy protection get to keep their home, cars, and all of their other property.

When you file for bankruptcy, you must list all of the property which you own at that time. Depending on the value of your car and the nature of your various items of property, you can protect and prevent most property from being taken by the bankruptcy court.

If you want to keep your home or cars but still owe money to your creditors for mortgage payments or car loan payments, then your payment obligations to those creditors must be current when you file a Chapter 7 bankruptcy, and you must continue to pay those debts after you have filed bankruptcy.

If you have fallen behind on your mortgage payments or car loan payments, but still want to save and keep your home or cars, then bankruptcy may still be able to help you achieve your goals. In these situations when you are not current on your mortgage or car loan payments, Chapter 13 bankruptcy can allow you to pay back some of your debts to your creditors through a payment plan. The bankruptcy filing will stop the foreclosure process for your home and will prevent the repossession of your cars by your lenders. However, you will need to resume making your regular monthly mortgage payments to your lender after your case has been filed if you intend to keep your home.

A common reason why people file bankruptcy is to be able to save their home and cars. You should speak with an experienced bankruptcy attorney who can assist you in determining whether you will be able to save your home and cars, and whether bankruptcy is a good option for you.