Hey, so I’m going through a rough patch. I’ve got some medical issues and haven’t been able to work full time. Now, I might have a rotator cuff injury, and it seems like it could take a while to recover. I live in Idaho, which is a community property state, and I want to file for bankruptcy for some loans and credit card debt that are just in my name. The problem is, since Idaho is a community property state, my wife could be held liable for these debts. Plus, we own a house that’s appreciated a lot, and I’ve heard they could go after the equity in the home. I’m filing a quitclaim on the house, but that might not remove me from the mortgage. Any ideas on how to handle this situation? I really don’t want to lose our home.
I totally get your situation. If your wife can refinance the house in her name, that might help. Just be careful since Idaho is a community property state. They might still go after your equity in the house, especially if you file for bankruptcy.
@Haru
Yeah, that’s what I was thinking. I’m just worried about the whole equity thing. Do you know if there’s anything I can do to protect it?
Paxton said:
@Haru
Yeah, that’s what I was thinking. I’m just worried about the whole equity thing. Do you know if there’s anything I can do to protect it?
You could look into the homestead exemption in Idaho. It might protect some of the equity in your home. You should also talk to a bankruptcy lawyer about possibly filing under Chapter 13, which could help with keeping your house.
Paxton said:
@Haru
Yeah, that’s what I was thinking. I’m just worried about the whole equity thing. Do you know if there’s anything I can do to protect it?
Homestead exemption could work, but remember, the amount it covers might be limited based on the value of your home. Definitely check with a lawyer to see how much protection you’d get.
Community property states are tricky, especially with something like bankruptcy. I’d definitely recommend talking to a lawyer to make sure you’re doing everything legally to avoid complications later.
Wynn said:
Community property states are tricky, especially with something like bankruptcy. I’d definitely recommend talking to a lawyer to make sure you’re doing everything legally to avoid complications later.
Yeah, I’ve been looking into it. It’s just hard to know where to start. Do you know how long this process might take?
@Paxton
It really depends on your case, but filing for bankruptcy can take a few months, especially with assets involved. Chapter 13 could take even longer since it’s a payment plan. Good luck!
@Paxton
It can take up to 6 months depending on your situation. Chapter 13 could drag on longer because of the repayment plan, but you could avoid losing the house, so it might be worth it.
If you’re thinking about moving to North Carolina, that might change things. It’s not a community property state, so you could avoid some issues. But you’ll still need to handle the Idaho property carefully.
@Payne
That’s what I was wondering. If I move to NC and file for bankruptcy there, would that help with the house? I’m just trying to figure out if I can avoid losing it.
Paxton said:
@Payne
That’s what I was wondering. If I move to NC and file for bankruptcy there, would that help with the house? I’m just trying to figure out if I can avoid losing it.
It might help, but since the house is in Idaho, it could still be considered part of your assets in a bankruptcy. Make sure you’re clear on the rules about transferring property if you move.
Paxton said:
@Payne
That’s what I was wondering. If I move to NC and file for bankruptcy there, would that help with the house? I’m just trying to figure out if I can avoid losing it.
Yeah, I agree. Even though you’re in a different state, the bankruptcy trustee might still include the house in your case because it’s a significant asset. Keep that in mind.
@Payne
I was thinking if I moved, maybe it would help, but now I’m worried about all the different rules between states. It’s so confusing.
Paxton said:
@Payne
I was thinking if I moved, maybe it would help, but now I’m worried about all the different rules between states. It’s so confusing.
Yeah, it can definitely be confusing. But the main thing is to make sure you’re handling everything openly. Don’t try to hide assets or it could cause bigger problems later.
Just a heads up, filing a quitclaim deed won’t remove you from the mortgage. If you’re looking to get your name off the loan, refinancing would be the way to go. But with the way Idaho works, you’ll want to make sure everything is handled properly to avoid problems later.
@Reece
I was wondering about that. So even if I file the quitclaim, I’d still be on the hook for the mortgage? That’s not ideal…
Paxton said:
@Reece
I was wondering about that. So even if I file the quitclaim, I’d still be on the hook for the mortgage? That’s not ideal…
Yeah, it’s a tough situation. The mortgage lender would need to remove you from the loan, which could happen with refinancing. But in a community property state, everything gets a bit more complicated.
Paxton said:
@Reece
I was wondering about that. So even if I file the quitclaim, I’d still be on the hook for the mortgage? That’s not ideal…
Refinancing might be your best option if your wife can handle it on her own. But if you’re worried about it, talking to a bankruptcy lawyer is key. They might have more options for you.
@Reece
This is exactly what happened to me! I filed a quitclaim and thought I was good, but I was still stuck with the mortgage until I refinanced. It was a headache!