Most people are worried about what their creditors can do to them. They are also worried about what they will lose in their bankruptcy. Some are shocked to discover that going bankrupt does not necessarily mean that all their debts are wiped out, and they don’t lose any of their possessions.
While it does happen that some property may have to be forfeited in bankruptcy, this is also a form of debt relief that does help some individuals to keep some of their important possessions through exemptions, and at the same time allows them to get a fresh start.
One concern is keeping their homes, and many times they not only have a first mortgage but a second one as well. Mortgages are handled different according to the form of bankruptcy that you are filing for. Your Dayton bankruptcy attorney will advise you as to what will happen with your mortgages depending on whether you are filing a Chapter 7 or Chapter 13 Bankruptcy. Each State has its own rules that it follows for bankruptcy so this also must be kept in mind.
If the amount you owe on your mortgages is higher than what the value of the house is worth according to fair market value then in a Chapter 13 Bankruptcy it may end up that the second mortgage is wiped out. Every bankruptcy is different based on the individual’s situation, and one should not jump to conclusions based on the outcome of someone else’s bankruptcy.