considering bankruptcy

February 17th, 2009 by Questions

i have a mortgage and a line of credit i can`t afford. I owe 3 hundred thousand on my home. If I sell my home for half the price I to pay off the line of credit but still can`t pay for the outstanding amount will bankruptcy cover that?

Posted from: Alberta


One Response to “considering bankruptcy”

, Barton Goth - Goth & Company Inc. -Trustee in Bankruptcy said:

The majority of your unsecured debt can be cleared by the filing of a proposal. With secured debt such as a mortgage, if you sell the property and there aren’t sufficient proceeds to cover the full balance of the mortgage, the shortfall is definately cleared. The only cautionary note is you need to sell the house for fair market value, I have had a few situations where people were going to end up in bankruptcy anyway, decided to try and give their relative a good deal as they were going to loos the house anyway and then sold this for fair market value. If this type of thing happens and a bankruptcy is filed, the transaction is overturned as it really wasn’t done in good faith and effectively prejudices the rights of the creditors.

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