Can You File for Bankruptcy in Georgia Without Losing Your House?

Yes, you can keep your house when filing bankruptcy in Georgia. Both Chapter 7 and Chapter 13 provide ways to protect a home. Which option you choose will depend on your circumstances.

Filing for bankruptcy is difficult enough considering the stress it can cause and the significant negative effect it will have on your credit score. The thought of bankruptcy becomes even more troubling if you fear that you may lose your home. Fortunately, there are ways to file without losing your house.

Georgia homeowners can file for bankruptcy to eliminate debts and still keep their house. Bankruptcy laws allow you to exempt your home as long as it falls within certain guidelines. This means creditors cannot go after your house when making claims on your assets as part of the bankruptcy process.

Keeping your house with Chapter 13

This is particularly true with Chapter 13 bankruptcy, which allows you to hold on to your assets and pay back all or a portion of your debts over a period of several years. If you have built up equity in your home, this may be a great option as long as you can continue to make any mortgage payments.

Keeping your house with Chapter 7

Under Chapter 7, however, there’s no guarantee that you will be able to keep certain assets or property. You may be able to file for Chapter 7 without losing your house as long as you are current on your mortgage payments and the equity in the house is protected by available exemption laws. This means the equity in your home must be lower than the exemption limit.

Georgia equity exemptions to protect your home

In Georgia, there are bankruptcy exemptions for up to $21,500 in real estate or personal property that either you or a dependent uses as a residence. This value increases to $43,000 if you are married and the property is owned by one spouse. You may also use up to $5,000 of unused homestead exemptions to protect any other property you own.

Beyond those exemptions, you are not protected. However, that exemption limit could give you significant assistance so that you can stay in your house.

Making mortgage payments

If you are in dire financial straits and risk falling behind on your mortgage payments, you can benefit greatly from Chapter 7 bankruptcy. This is especially true in a situation in which you’ve been laid off or have a mortgage interest rate that’s about to increase. In some cases, it could make sense for you to make advanced payments on your mortgage before you file for Chapter 7.

Chapter 7 rules allow you to eliminate most of your debts, except for student loans, child support, alimony and back taxes. However, it is important to make measured, informed decisions, because you won’t be able to change your mind once you file. The court will not allow you to back out of a bankruptcy case, so you need to be absolutely certain that Chapter 7 is the best route forward if one of your goals is to maintain your home.

This is why it’s so important to work with an experienced attorney who can advise you on the best way to proceed based on your circumstances. To learn more about how you can keep your home when filing for bankruptcy in Georgia, speak with a skilled bankruptcy attorney at Jeff Field & Associates. Call us at 404-381-1278 or contact us online to set up a free initial consultation.