Legal Question in Bankruptcy in New York

Residence Property

I currently owe my creditors in excess of $50,000. My home mortage payoff is $57,000 with an estimated value of $80,000, leaving equity of appox. $23,000.

If I file Ch.7 bankruptcy would I lose that equity toward paying the creditors or in NY State, based on the amount in debt vs. my home equity would I not lose the possible equity that I've accrued?

Thank You...


Asked on 4/05/01, 9:42 am

1 Answer from Attorneys
Garry Hanlon

Re: Residence Property

In New York the homestead exemption is

limited to $ 10,000

If you are married and both husband and

wife are on the deed and mortgage, this

is $ 10000 each for a total of $ 20,000

If that is the case, the $ 23,000 would

be protected by the exemptions and other

minor reductions

If you are single, you have a non-exempt

asset in the amount of $ 13,000.00. A

Chapter 7 trustee will sell your house,

pay off your mortgage, give you $ 10,000

and use the rest to pay creditors

You can save the house and eliminate most

of your debt by filing a chapter 13 and

paying the 13,000 unprotected equity back

to the Chapter 13 trustee over the 3 to

5 year period of the Chapter 13 plan

Any of these suggestions requires other

factors such as income and other assets

before being effective

Read more
Answered on 6/06/01, 10:09 pm


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