Monmouth County Bankruptcy and Real Estate Attorney
How real estate is treated in bankruptcy will depend upon whether there is equity in the property and upon which Chapter in bankruptcy is filed; a Chapter 7, a Chapter 13 or a Chapter 11. If there is little or no equity in a person’s home or other real estate, a bankruptcy filing will generally not affect the real estate. If there is equity in the property, a homeowner may have to propose to repay some of that equity through the bankruptcy process, often in a Chapter 13. Prior to a bankruptcy filing, an experienced attorney will perform what is called a “liquidation analysis” for any real property owned. The attorney will calculate whether there is any non-exempt (unprotected) equity in the real estate that could be at risk from a bankruptcy filing and will advise a homeowner what options are available to retain the property. The filing of a bankruptcy case under any Chapter will generally stay (temporarily stop) all legal action against real estate, including a pending foreclosure action. The bankruptcy stay will apply even if the bankruptcy filer owns the real property together with another person. This “hold” on legal action against real estate provides the homeowner temporary relief from aggressive creditor action, allowing the homeowner time to carefully evaluate his options.