July 27th, 2012 by Questions
is it true when you file for bankruptcy you loose your home in ontario..even if you have no equity in your home…
Posted from: Ontario
July 27, 2012 at 1:02 am, Barton Goth - Goth & Company Inc. -Trustee in Bankruptcy said:
What is true is that the province of Ontario has no exemption allowance for a principle residence. So what does this mean, it means if you have equity in the property that equity must be realized on for the benefit of creditors. So for example if you house is worth $200,000 and the mortgage is $195,000 and you file bankruptcy there will be $5,000 that needs to come into offset this non-exempt equity in the residence. In most instances you can make an arrangement with the trustee to pay this in as part of the bankruptcy.
Now if you have no equity there is no problem. You simply continue to make your payments on the mortgage and the bankruptcy won’t impact the house.
So no, you don’t always loose you home.
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