If you are at a point financially where bankruptcy seems your only option, you may be overlooking a way of avoiding filing altogether—the equity in your home. It is important to make such a decision only after strong consideration, and Bryan bankruptcy lawyers can discuss your case to see if this is a good option.
Using Your Home Equity
The equity in your home is built up in two ways: through paying off your mortgage, and with a rise in the value of the property. In many cases this equity is available to homeowners for a variety of purposes, and, indeed, many take out equity lines of credit to finance swimming pools, room add-ons, and remodeling. This same equity may be used to pay down your debts, and in so doing allow you to forego bankruptcy.
You must be careful, however. If you have fallen behind in your house payment this may not be an option. You should not wait until the mortgage holder is ready to foreclose on the property, for then it might be too late. Instead, be proactive and seek out a loan through a good lender. If your credit score has not yet been adversely affected by your financial difficulties you stand a better chance, and at a better rate.
Using Your Home Equity during a Chapter 13 Bankruptcy
You may also be able to use your home equity once you have filed Chapter 13. It is better for you to take the initiative and make this suggestion, for otherwise the trustee may tap into this resource anyway. You have more leverage if you seek out a home equity loan soon after filing Chapter 13.
Be careful, though, for there are pitfalls. By using your equity you are not relieving yourself of the debt. Rather, you are simply moving it around a bit, and someday you will need to pay any debts off.