Are you facing bankruptcy in Michigan and worried about losing your home? The thought of losing your home can be overwhelming, but there are options available to help you keep it. If you no longer want your property and need to get out of your mortgage, you can sell your house to avoid bankruptcy and start fresh without hurting your credit.
Below, you’ll learn about bankruptcy in Michigan, the impact it has on home ownership, and how to keep or sell your home during bankruptcy.
How Does Bankruptcy Work in Michigan?
Bankruptcy is a legal process that provides individuals and businesses with the opportunity to eliminate or restructure their debt. In Michigan, bankruptcy is governed by federal law and is overseen by the U.S. Bankruptcy Court.
There are two types of bankruptcy available to individuals: Chapter 7 and Chapter 13.
Chapter 7 Bankruptcy
Chapter 7 bankruptcy is also known as a “liquidation” bankruptcy. In a Chapter 7 bankruptcy, a trustee is appointed to sell your non-exempt assets to pay off your creditors. However, certain assets, such as your primary residence, may be protected by exemptions.
Chapter 13 Bankruptcy
Chapter 13 bankruptcy is also known as a “reorganization” bankruptcy. In a Chapter 13 bankruptcy, you create a repayment plan to pay off your creditors over a period of three to five years. This type of bankruptcy allows you to keep your assets, including your home.
The Impact of Bankruptcy on Homeownership
Bankruptcy can have a significant impact on homeownership. If you file for Chapter 7 bankruptcy and your home is not exempt, the trustee may sell your home to pay off your creditors. However, if you file for Chapter 13 bankruptcy, you may be able to keep your home if you can continue to make your mortgage payments.
Bankruptcy can also impact your credit score and make it more difficult to obtain a mortgage in the future. However, if you are facing financial difficulties and are unable to pay your debts, bankruptcy may be your best option to get back on track.
How to Keep Your Home in Bankruptcy
If you want to keep your home during bankruptcy, you have a few options available to you.
- File for Chapter 13 bankruptcy. This type of bankruptcy allows you to keep your assets, including your home, as long as you can continue to make your mortgage payments.
- Negotiate with your lender to modify your mortgage. A mortgage modification can help you reduce your monthly payments and make it more affordable to keep your home. However, not all lenders offer mortgage modifications, and the process can be time-consuming and complicated.
- Sell your home to a cash home buyer to avoid bankruptcy altogether. You can close the sale quickly and pay off the debt before your bankruptcy goes through.
Selling Your House As-Is for Cash to Avoid Bankruptcy
If you are facing bankruptcy and want to avoid losing your home, selling your house to a cash home buyer may be a viable option. A cash home sale allows you to sell your home quickly and for cash, which can help you pay off your debts and avoid bankruptcy.
There are several benefits to a cash home sale, including:
- Sell your house fast: A cash home sale can be completed in as little as seven days, which can be beneficial if you need to sell your home quickly.
- No home repairs: A cash home buyer will purchase your home as-is, which means you don’t have to worry about making any repairs or renovations.
- No realtor commission or fees: When you sell your home to a cash buyer, you don’t have to pay any real estate agent fees or commissions.
- No closing costs: A cash home buyer will typically cover all closing costs associated with the sale, which can save you money.
If you are facing bankruptcy in Michigan and want to keep your home, there are several options available to you. Filing for Chapter 13 bankruptcy, negotiating a mortgage modification, and selling your home to a cash home buyer are all viable options. It’s important to do your research and find the option that works best for you.
We Buy Houses in Detroit, Michigan
If you need to sell your house fast but don’t want the hassle of a traditional home sale, contact M1 Home Buyers. We buy houses as-is. No repairs are needed. Avoid closing costs and realtor commissions. Close in as little as seven days. Call 248-397-5800 to get a fast cash offer from our local home buyers.