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  1. #1

    Default Can I File for Bankruptcy

    My question involves bankruptcy in the state of: Kentucky
    I bought a home 6 months ago that turned out to be a nightmare. I won't go into how I got rooked into that. Anyway the basement had severe damage. I have tried to repair it but it is just one thing after another. It has taken every penny I have. I can't pay my bills. I have $4000 credit card debt and a student loan. I have another credit card but I just can't put anything else on it because I already can't pay what I have. The home is causing me health problems and I can't even afford to go to the doctor. Can I file for bankruptcy ? Please? I need some help. I don't know where to turn. I had excellent credit before I bought this nightmare.

  2. #2
    Join Date
    Sep 2010
    Posts
    478

    Default Re: Can I File for Bankruptcy

    Stop panicking. You need to sit down with a qualified bk attny in your area. Most do not charge for the initial consultation.

    You can file bk. The question is which Chapter. Most folks want to do a Chapter 7 but you must meet certain qualifications to file. Your income must be below a certain level for the 6 months prior to filing, or, if above, after doing "means testing" you cannot have any disposable income. Sounds simple but it is not.

    In your bk you can surrender the home. The lender takes back the property and you owe nothing. The credit cards, medical bills, signature loans etc can be wiped out. What will survive the bk (assuming a Chapter 7) will be the student loan(s), taxes (there are a few exceptions) and domestic support you might owe. If there is a HOA associated with the home you will need to pay all dues/assessments that fall due from the day you file until the day the property is foreclosed.

    The student loans are considered non dischargeable unless you file a separate adversary inside the bk and get the Judge to determine that forcing you to pay will be a hardship. This is an uphill battle but you should discuss this with the attny.

    Next step - make the call to an attorney.

  3. #3
    Join Date
    Jan 2008
    Posts
    164

    Default Re: Can I File for Bankruptcy

    I agree with despritfreya, do not panic repeat do not panic, please speek with a BK lawyer as soon as possible!



    God Bless

  4. #4

    Default Re: Can I File for Bankruptcy

    Thank you. Another question. Is it better to file for bankruptcy,foreclosure or,deed in lieu of foreclosure?

  5. #5
    Join Date
    Sep 2010
    Posts
    478

    Default Re: Can I File for Bankruptcy

    In response to:

    "Is it better to file for bankruptcy, foreclosure or, deed in lieu of foreclosure?"

    It depends. I do not practice in Kentucky so I do not know if your state has an anti-deficiency statute which would preclude it from going after you for any $$ once it forecloses. If there is such a statute that applies then just walk away and you will not need a bk.

    A Deed in Lieu, IMHO is the same as a foreclosure as it relates to your credit report. Again, IMHO it only helps the lender by saving the cost of foreclosing. However, if your State IS NOT an anti-deficiency state then, so long as the DIL releases you from any other liability there is a benefit to you and you do not need to filing bk.

    So to recap:

    1. You do a bk if you have exposure to a claim once the property is lost to a foreclosure.

    2. You walk away if there is no exposure to a claim after the property is foreclosed and therefore no need to file bk.

    3. You do a DIL if doing so eliminate any potential exposure to a claim and therefore eliminate the need to file bk.

    Hope this helps.

  6. #6

    Default Re: Can I File for Bankruptcy

    Thank you so much.

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