Life changing experiences come in all different ways, some good, some bad. During the real estate boom many homeowners found themselves rich in equity and were able to refinance their homes and take cash out for home improvements and luxurious trips that would typically be out of reach.
Unfortunately for many, the boom went bust, and debts became harder to repay. Homeowners throughout the country found themselves struggling to make ends meet and could no longer borrow against equity lines due to steep declines in home values.
Example Bankruptcy Case
A client prospective came to us with a property valued at $420,000, a 1st mortgage of $397,000 and a 2nd lien of $175,000 from a home equity line. Needless to say the home had once been valued over $750,000 in Riverside, California.
The homeowner was able to take $175,000 out for a pool, new furniture, and a once in a lifetime trip to Europe. Unfortunately, the husbands job stopped paying overtime and bonuses while his wife suffered a job loss. They could not meet their financial obligation, the mortgage fell behind 4 months and they were declined a loan modification.
Solution
In fear of losing their home they consulted with us to discuss options with filing bankruptcy Chapter 13 in an effort to save their home from foreclosure. By filing Chapter 13 they were able to catch up on their mortgage, eliminate their credit card debt and strip the 2nd mortgage of $175,000! Not such a bad deal, and certainly a life changing experience.
When to Talk to a Lawyer
If you are caught up in a financial struggle and feel there's no end in sight call your local bankruptcy attorney and find out how a bankruptcy may be able to help you get your life back on track. Our California bankruptcy attorneys have experience filing Chapter 7, Chapter 13, and Chapter 11 bankruptcies. For a FREE consultation call us at (800) 972-9600.
