The question of housing often comes up during discussions of bankruptcy. Many people assume that filing automatically means a loss of homes, but this is not always the case; in many situations, one can keep one’s home. The deciding factor is generally the worth of the dwelling, and if you are worried about losing it during bankruptcy, it is relatively easy to determine whether or not your home can be kept. You may benefit from knowing this information before you approach your bankruptcy attorney in Draper, Utah.
UTAH BANKRUPTCY EXEMPTIONS
Homestead exemptions are federal and state protections against seizure of your home. These are very specific; in Utah, your homestead exemption cannot exceed $30,000 (or $60,000 if you are filing jointly) for your primary residence. This does not mean that you will lose your home if your home is worth more than that; the homestead exemption protects equity, so as long as your equity does not exceed your homestead exemption, you should be safe. If you are not certain whether or not your home will be seized regardless of the homestead exemption, you can always ask your attorney any questions you may have.
If you live in a home which is worth less than the amount you owe on it, you live in a home with no equity. This is good news for you in a Chapter 7; homes with no equity are safe from being seized, as selling them would actually be worse for your overall estate. This can be determined with a little bit of mathematics; you can calculate the equity by adding up the mortgages and liens on your home and subtracting them from the amount your house is worth on today’s market. If the answer comes up negative, your home has no equity.
Once you have calculated your home’s equity, you can decide whether or not you need to file a Declaration of Homestead. This is a form you must complete which describes the property, how much the property is worth, and your marital and filing status. You can claim up to the full amount of $30,000 per person filing. There are certain rare cases in which the Declaration of Homestead might be denied; however, speaking to an affordable bankruptcy attorney in Utah will help you find out whether or not your property qualifies. As you can see, your home is much more protected in a Chapter 7 bankruptcy than you may have been led to believe.
We hope this information about Chapter 7 Bankruptcy in Utah has been helpful to you. While this information is helpful, it cannot take the place of the expert advice you can get by scheduling a free, no obligation consultation with BDJ Express Law today. If you have further questions about filing Utah Bankruptcy, please call us at 801-438-3520 for Draper or 801-394-2336 for Ogden. We look forward to meeting with you.