QUESTION
If the trustee in a NC chapter 7 bankruptcy sells my home will I receive payment?
Asked on Jun 27th, 2021 on Bankruptcy - North Carolina
More details to this question:
My spouse and I owe $53,000 in unsecured debt and we are going to file Chapter 7 bankruptcy. We don’t want to file chapter 13 we can’t afford the repayment plan. I’m the owner of our house and I still owe $18,000 to my mortgage company the listed value is $80,000 that puts the equity over the NC homestead exemption of $35,000 if the trustee sells our home how will the money be distributed? Will I be paid the exemption of $35,000? After the creditors and mortgage company are paid or will the mortgage balance be taken out of the $35,000 leaving me with only $17,000? I’m confused on that part. Thanks for any information.
1 ANSWER
4 Awards
You need to have a personal consultation with a consumer bankruptcy attorney to get a specific answer. It depends upon if you have any joint debts or not and if the house is titled under both names or not. In addition, the tax listed value of your home is probably lower than the actual market value in today's real estate market. Do NOT file Chapter 7 without an attorney. In many instances filing a Chapter 7 does not have to be done immediately and an attorney can advise you on the pros and cons of filing Chapter 7 now, versus waiting to file until the real estate market cools off. In addition, the Chapter 7 Trustee has the authority to make deals with creditors to accept offers on your home for an amount that may preclude you from receiving your full exemption value. In general terms, if both you and your husband are on the deed to the home, each of you gets a $35,000 exemption, so if you file Chapter 7 together, there would be $70,000.00 exemption available. What your specific exemption would be depends upon the factors I mentioned above. Many consumer bankruptcy attorneys offer free consultations. If you already had a consultation with one attorney, consider getting a second opinion. Good luck.
Answered on Jun 28th, 2021 at 6:46 AM
This is general legal advice only. You do not have an attorney-client relationship with Attorney Lynn E. Coleman without a signed retainer agreement and payment of any applicable fees.