Trying to decide whether or not to file for bankruptcy can undoubtedly be a stressful time, especially when you have questions concerning your housing needs. One worry can follow the next, especially if you don’t have all the information you need to determine which type of bankruptcy makes the most sense for you to file.
Keep reading to learn if you can buy a house or other property (and keep it) after filing for Chapter 7 or Chapter 13 bankruptcy in Wisconsin.
In determining your best course of action as you consider bankruptcy, it would be in your best interest to consult a skilled bankruptcy attorney to review your options. You can also discuss how your potential filing might impact your ability to purchase real estate.
For more information on bankruptcy issues in Wisconsin, you may want to read the following articles by The Fitzgerald Law Firm:
- “4 Questions to Consider Before Filing for Bankruptcy in Wisconsin”
- “Filing for Bankruptcy in Wisconsin and Illinois”
- “Is it Possible to Keep Your Home When Filing for Bankruptcy in Wisconsin?”
Can I Buy a House After Filing for Bankruptcy in Wisconsin?
The answer to this question is complicated by many factors.
It is possible to purchase property after filing for bankruptcy in Wisconsin, but whether or not the courts will endorse your choice to do so depends on factors such as your financial discipline, as well as the type of bankruptcy you filed. How soon you might be able to buy a house of other property is another factor impacted by which bankruptcy chapter you pursue.
It is recommended you get these answers prior to entering discussions with a Realtor.
You may also want answers to these questions when deciding which type of bankruptcy is right for you.
To get the answers you need in trying to determine if you will be able to buy a home or other property after filing for bankruptcy, you should consult a proven bankruptcy lawyer in Wisconsin.
Chapter 7 Bankruptcy
Since Chapter 7 is used to discharge or release debt, property you own becomes part of your bankruptcy estate. The Trustee, or person assigned to head up your bankruptcy, typically sells your property in order to pay off your creditors. There are bankruptcy exceptions, including the homestead exemption, which you can explore with an experienced bankruptcy attorney.
Since you are essentially telling the courts through a Chapter 7 filing that you are not able to pay your debts, purchasing a house soon after is less likely. You will need time to re-establish your credit.
- Been able to re-establish good credit (have not taken on new debt)
- Have demonstrated the ability to handle your financial affairs
- Have not had any late payments
Since Chapter 7 filings tend to move quickly, you would be able to start saving and working toward a clean credit slate sooner.
If you are putting off filing for debt forgiveness, but would like to start planning to buy a house after Chapter 7, it would be best to consult a lawyer whose focus is helping individuals with bankruptcy filings to explore your options. The sooner you have this important conversation concerning your specific needs, the sooner you can start planning for your future.
As with any legal case, the exact answer to any question will depend upon the specific details of your case and situation, which you should discuss with an informed and knowledgeable bankruptcy attorney.
If you are wondering if Chapter 7 is right for you, consult a proven bankruptcy lawyer to discuss your situation and start on the path to debt forgiveness.
Chapter 13 Bankruptcy
If you’re wondering if you can file Chapter 13 and go on to buy a house or other property in Wisconsin, you have more options than with a Chapter 7 filing. However, there are still certain conditions you must meet and maintain in order to buy a house or other property after filing for Chapter 13 in Wisconsin.
When you file for Chapter 13 bankruptcy in Wisconsin, you are not walking away from your debt; you are agreeing to new measures to ensure you can pay off your debt. This type of bankruptcy filing means you agree to pay off your debt, but need to reorganize your payment schedule.
Since Chapter 13 is not used for debt forgiveness, but rather for debt reorganization, you should be able to retain your property and any property you subsequently purchase, providing you meet the following:
- Your bankruptcy trustee must approve of your property purchase
- You need to establish a payment history of at least one (1) year
- Your bankruptcy or case trustee must agree
If you filed Chapter 13, you do not face the same waiting period that exists with Chapter 7 for an FHA loan, though the loan options available to you may be limited based on your individual financial circumstances.
If you are wondering if you can buy a house during a Chapter 13 filing, it is possible but more difficult. While it is not a requirement to be through your bankruptcy to purchase property, you may have more loan options after your bankruptcy case is resolved. The duration of a Chapter 13 bankruptcy case typically lasts from 3-5 years.
If you are are interested in learning more about how filing Chapter 13 bankruptcy in Wisconsin would impact your ability to buy a home or other property, you should discuss your situation with an established bankruptcy attorney to make sure you aren’t overlooking anything in exploring your options.
How Can I Be Sure to Keep My House After Chapter 13?
While you will be allowed to keep, or even purchase a house or other property after you file for Chapter 13 bankruptcy in Wisconsin, there are steps you will be required to take in order to retain or keep that ownership. You must:
- Pay your bankruptcy payments in full
- Pay your bankruptcy payments on time
- Never miss a payment
Debt reorganization is intended to assist you to in paying off your debt, while maintaining your property, though it can be challenging to follow the repayment schedule.
Many Wisconsin residents who have filed for Chapter 13 bankruptcy, find keeping up with the new payment schedule is still too challenging. If you share this concern, you may want to convert your bankruptcy filing from Chapter 13 to Chapter 7.
If this sounds like an option you might like to pursue, it is in your best interest to discuss your specific circumstances with a proven bankruptcy attorney in order to get the clearest picture of your options before deciding your next steps–especially if you hope to convert from Chapter 13 to Chapter 7 and keep your house in Wisconsin.
If you would like assistance as you consider filing for Chapter 13 in Wisconsin, or if you would like to learn more about converting your Chapter 13 bankruptcy to a Chapter 7 filing, contact a knowledgeable bankruptcy attorney to discuss your options.
FREE 15-Minute Consultation
The Fitzgerald Law Firm specializes in helping clients in their effort to get out from under the constrains of debt. Beloit Attorney Lane Fitzgerald is pleased to offer a FREE 15-minute consultation at no obligation to discuss your options as you consider bankruptcy.