Legal Question in Credit and Debt Law in Wisconsin

Medical Bills, Homestead Exemptions and Poverty

Your questions are too specific to answer in a public forum. I would therefore advise you to seek advice as soon as possible from a bankruptcy attorney. Generally speaking, a WI person of modest means is allowed to keep a home following a chapter 7 filing so long as its net value does not exceed $40,000. (I personally believe that this figure is too low, since it was enacted decades ago and has not been adequately adjusted for inflation.) Even if it is worth more than that, the bankruptcy trustee will not bother to liquidate it unless there would be enough left over to make a meaningful pro rata payment to creditors. In a chapter 13 bankruptcy, debtors are allowed to retain a home with a higher valuation, but must pay creditors at least the non-exempt portion of that value over a number of years. During the repayment plan, the debtor is protected from collection activities of past creditors. If you have a mortgage on the home, you will need to continue the mortgage payments in order to retain it, regardless of exemptions. Another issue for someone with major health problems is insurance coverage, probably through a government entitlement program such SSI. Eligibility, however, requires that you fit within poverty definitions, which do provide some relief for your living quarters. You need to discuss this with a social security attorney.