Utah has a homestead exemption that protects $30,000 in home equity ($60,000 if owned jointly). If you only have the exempt amount of home equity then you will not lose your home as long as you keep your mortgage current. Under Chapter 13 you can keep your home even if you do have more than the exempt amount of equity in your home. However, under Chapter 7 it is possible that the trustee will request to sell your home if they determine that there is more than the exempt amount of equity. He/she would be required to give you a check for $20,000 to $40,000 and would then give the rest to your creditors. If you have a substantial amount of equity in your home then you should discuss asset protection techniques with your attorney and should also consider a Chapter 13.

Posted in: Frequently Asked Bankruptcy Questions