Posted on: 12th Dec, 2008 08:57 pm
We own a 20 year old company construction related which has almost reached foreclosure stage. The company owes about approx $400,000 in debt. Although a cooperation I've signed personal quotes as well on the debts. The business is almost on a standstill and I might be shutting the business down. I expect the creditors to come after me personally, which will make me go for Chapter 7 to save myself.
I've only one primary residence which is upside down. I've taken hundred and fifty thousand dollars on line of credit on my personal house for business. The actual value purchase of the house was $520,000 and the current market value is $315,000. Since I will be filing Chapter 7, will it automatically wave off 50% borrowing on line of credit? As the house is under mine and my spouse's name.
How do I manage to save the house? As well as modify the value to a reasonable level from the lender?
I've only one primary residence which is upside down. I've taken hundred and fifty thousand dollars on line of credit on my personal house for business. The actual value purchase of the house was $520,000 and the current market value is $315,000. Since I will be filing Chapter 7, will it automatically wave off 50% borrowing on line of credit? As the house is under mine and my spouse's name.
How do I manage to save the house? As well as modify the value to a reasonable level from the lender?
Hi irum_asghar
I don't think filing a chapter 7 will waive off 50% borrowing on line of credit. As you used a property as collateral for a loan, you'll need to pay something to the creditor if you want to keep the property. You may "reaffirm" the debt and agree on new contract terms with the lender. However, to be on the safer side, you can consult a bankruptcy attorney and take his advice.
Thanks.
I don't think filing a chapter 7 will waive off 50% borrowing on line of credit. As you used a property as collateral for a loan, you'll need to pay something to the creditor if you want to keep the property. You may "reaffirm" the debt and agree on new contract terms with the lender. However, to be on the safer side, you can consult a bankruptcy attorney and take his advice.
Thanks.