Many people in Kentucky feel uneasy when their finances start to spiral out of control, and once this starts happening, it may prove tough to come back from it. If you find yourself facing increasingly overwhelming levels of debt, you may start exploring the idea of filing for bankruptcy. However, you may have concerns about having to potentially give up your house if you do so.
Per U.S. News and World Reports, many people filing for bankruptcy share similar fears about losing their homes. However, in Texas, this rarely happens.
Chapter 7 bankruptcy and your home
In general, whether your home is at risk when you file for bankruptcy depends on the type of consumer bankruptcy you file for and the state you live in. While some Americans’ homes may be at risk when they file for Chapter 7, this rarely happens in Texas. This is because the state has certain exemptions in place that help protect your property when you file. As long as you stay atop your mortgage payments moving forward, you should be able to remain in your home.
Chapter 13 bankruptcy and your home
You also typically get to keep your home in a Chapter 13 filing. As long as you stay current on your mortgage payments and otherwise keep up with the repayment terms of the payback plan you come up with as part of your Chapter 13 filing, your home should remain in your possession.
In summary, if fears about losing your home are keeping you from digging your way out of debt, know that these fears, for the most part, lack merit. Many people in Texas file for bankruptcy, rebuild their financial lives and stay in their homes while they do so.