If you count yourself among the many across Ohio who are struggling to remain afloat financially, you may be weighing your options and trying to determine the best way to start getting back on your feet. You may, too, be considering whether filing for bankruptcy might help you find the relief you seek, but you may have concerns about whether you could potentially lose your home, should you decide to do so.
According to the Washington Post, your ability to keep your home after filing for bankruptcy depends on certain circumstances, among them the type of bankruptcy filing you choose to pursue. In a Chapter 7 personal bankruptcy, for example, which is typically for lower-income earners, whether you will have to give up your home depends on whether it meets the criteria for an “exemption.” If the amount of equity you have in your home is lower than Ohio’s exemption amount, you are typically in good shape and should be able to avoid losing your home.
Should you opt for a Chapter 13 bankruptcy, on the other hand, know that this type of bankruptcy filing is for those with higher income levels, and it generally involves paying back some portion of your debts. With a Chapter 13 bankruptcy, you can typically hang on to your home, provided you work out a payment plan that allows you to regain control over your finances.
In some cases, you may be able to switch to a Chapter 13 bankruptcy from a Chapter 7 if you are fearful about losing your home. In other words, do not necessarily believe the common misconception that, by filing for bankruptcy, you will lose everything. You may have options available to you that will allow you to rebuild financially while still having a place to call home while doing so.
This information is educational in nature and not a substitute for legal advice.