Can I keep my house after filing for Chapter 7 Bankruptcy?

In Washington, the answer to whether you can keep your house after filing for Chapter 7 Bankruptcy depends on a few factors. Generally speaking, if you file for Chapter 7 Bankruptcy and can prove that you can make your mortgage payments, you will likely be able to keep your house. However, if your house is worth more than you owe on it, then the bankruptcy trustee may choose to sell it in order to repay your creditors. In a Chapter 7 Bankruptcy, you can also attempt to protect your house through two major exemptions that are available in Washington: the homestead exemption and the wildcard exemption. The homestead exemption protects a certain amount of the equity in your home, up to $125,000. The wildcard exemption allows you to protect up to $20,000 of the remaining equity in your home. If the equity in your home exceeds the total of the two exemptions, the trustee may choose to sell it to pay your creditors. Alternatively, you could enter into a reaffirmation agreement with your mortgage lender. This is a legally binding contract in which you agree to assume responsibility for the loan and make payments on time. However, this option is not required for Chapter 7 Bankruptcy and should only be entered into after careful consideration. In conclusion, it is possible to keep your house after filing for Chapter 7 Bankruptcy in Washington. However, doing so will depend on the amount of equity in your home, whether you can make your mortgage payments, and if you choose to enter into a reaffirmation agreement with your lender.

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