Legal Question in Bankruptcy in Tennessee

Filing bankruptcy on a new loan

I am in the process of refinancing my home to avoid bankruptcy. There isn't enough equity to pay all my debt. I'm not sure if I'll be able to handle the new mortgage pmt. and the other debts too. If I refinance and can't keep up the payments, can I file bankruptcy or is there a certain length of time you are required to have a loan before you can file?


Asked on 9/26/04, 9:12 pm

1 Answer from Attorneys
James R. Becker, Jr. Becker Law Firm

Re: Filing bankruptcy on a new loan

The bankruptcy code contains no limitation on how long you need to have a loan before you file for bankruptcy protection. However, before you refinance you will want to consider any contractual repercussions to your filing for bankruptcy. For instance, will the mortgage holder seek to impose a higher interest rate and if you are filing a Chapter 7 will the mortgage holder permit you to reaffirm the debt in bankruptcy. Anytime you are in this type of situation, it is usually best to go over your options thoroughly before selecting any course. It may be in your best interests to seek out an attorney that handles a debtor bankruptcy practice.

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Answered on 9/27/04, 10:11 am


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