Can you keep your home and car when filing for Chapter 7 bankruptcy in Knoxville, TN?
There’s not really a short answer to whether or not you can keep your home and car when filing for Chapter 7 bankruptcy in Knoxville, TN. It comes down to a few things that you need to be doing before filing for bankruptcy as well as the state of your finances. However, with the help of Bankruptcy Partners PLLC, we can identify what you need to do to be able to keep your home and your car. To get started, we have a few questions that you might have along the way.
What is Chapter 7 bankruptcy?
Before we get too deep into what you do and don’t get to keep when filing for bankruptcy, let’s explore what exactly it means to file Chapter 7 bankruptcy. The difference between Chapter 7 and other forms of bankruptcy is that you can liquidate most of your unsecured debt without having to propose a repayment plan. This means that your credit card bills, medical bills, or utility bills.
Any debt that you have that’s not backed by an investor and isn’t attached to an item like your car or home is considered unsecured debt. Home and auto loans are considered secured debt because the financial institution to which you make each payment can force you to surround the property if you refuse to pay. These debts are not forgiven without consequence with Chapter 7 bankruptcy.
What do I need to do to keep my home and car?
Not everybody who files for bankruptcy will lose their home or car. This is the first and most important thing to keep in mind when you’re considering filing for bankruptcy. If you don’t want to lose your home or vehicle, you will have to continue paying as it’s considered a secured debt. You can also get an exemption that protects your property from creditors that want you to sell a vehicle to pay them back.
Any property that doesn’t have an exemption will need to be sold or surrendered as a part of your debt settlement. Those who file for Chapter 7 must understand that there’s a give and take with filing for bankruptcy as your debt isn’t simply washed away without consequence.
What will you lose with Chapter 7?
As we mentioned, filing for bankruptcy doesn’t come without consequence. While your unsecured debts will be discharged and you no longer have any obligation to pay them back, you could lose any luxury items that you have purchased over the years as a way to pay off creditors. Any item that’s not covered by an exemption will need to be sold. This can include ATVs, boats, or other recreational vehicles.
What are the benefits that come with Chapter 7?
When you file for Chapter 7, your finances are protected. Creditors cannot come looking with collections or reach your wages. You also retain full control of your money to continue to pay for your necessities. Indeed, your credit will take a hit, but once you reach financial stability again, you can work to rebuild it quickly.
Contact us to get the help you deserve
If you’re considering filing Chapter 7 bankruptcy in Knoxville, TN, get in touch with us at Bankruptcy Partners PLLC. We’re here to help as you navigate the long and difficult journey of filing for bankruptcy. Our team of experts can help you make educated decisions regarding your filing as well as the best approach to take. Give us a call at 865-424-5200 or send a message using our contact form. We can schedule a free consultation to provide you with more information and help you get started.