CHAPTER 7 BANKRUPTCY & ITS EFFECTS ON YOUR HOME
If you otherwise qualify under Chapter 7, then you can keep your home if you will be able to keep current on your payments and your equity does not exceed the Homestead Exemption ($50,000 - $125,000) detailed in California Code of Civil Procedure (“CCP”) Section 704.730. To see more information about the homestead exemption, click here.
Under Chapter 7, you are permitted to reaffirm secured debts such as mortgages and car loans - but you don't have to.
What this means is that you may either surrender the property and have your debt wiped clean, or you can agree to continue making payment and keep the property (provided that the property is exempt).
To qualify for Chapter 7, your income must either be below the state median, or you must pass the Chapter 7 means test.
