Can You Refinance an Asset After Bankruptcy?

Filing for bankruptcy protection does not always leave a debtor without options concerning their assets. To the contrary, a debtor who has filed has numerous options to keep his or her assets. One popular question many filers have is, “Can you refinance an asset after bankruptcy?”

Basically, the answer is yes, but the answer, like bankruptcy law, is laden with complicated possibilities.

What type of individual bankruptcy you file, a Chapter 13 or a Chapter 7, might influence how you can handle the refinancing of a secured asset you own when you file.

The automatic stay of bankruptcy, common to all bankruptcies, means that the mere request for bankruptcy protection automatically stops and brings to a cessation certain lawsuits, foreclosures, utility shut-offs, evictions, repossessions, garnishments, attachments, and debt collection harassment.

In a Chapter 13, a bankruptcy lawyer might emphasize the importance of the stay to save your home from foreclosure. Chapter 13 bankruptcies, commonly called wage earner plans, enable individuals with regular income to develop a plan to repay all or part of their debts over three or five years.

If you have an exit plan for post Chapter 13 bankruptcy, you can refinance after 36 months and discharge the bankruptcy immediately. This saves you two years on your credit report, and can allow you to be transformed to a high risk borrower which can enable you to refinance. The interest rates will be a little higher, but you will be eligible for some government backed refinancing loans, which should make the loans affordable.

With a dismissed bankruptcy, a foreclosure bailout loan can be arranged. Most mortgage lenders will not refinance unless the mortgage refinance is arranged before a Chapter 7 is refiled.

A Chapter 7, commonly called liquidating your assets, is the simplest form of bankruptcy. In a Chapter 7 bankruptcy, a court trustee will take your non-exempt assets, liquidate them, and pay off your debts.

Potentially, if you can find a lender, you can refinance a secured asset included in a Chapter 7 bankruptcy one day after you have filed. You can refinance a secured asset included in a Chapter 13 bankruptcy before, during or after the bankruptcy, if you can find the lender.

Can you refinance an asset after bankruptcy? Yes, but what you pay for the refinancing is determined by your current credit score, the policy of the lending institution, and the type of lending institution.

Do lenders have to refinance your secured loan after you file bankruptcy? No. In most cases, it is may be wise if a lender can negotiate a refinance with a bankrupt debtor that has filed bankruptcy because the debtor who reaffirms such refinancing has no recourse for up to eight years once the bankruptcy is discharged.

Bankruptcy laws can be complicated, and common sense indicates you might need a bankruptcy lawyer in order to help you understand how these complex laws may apply in your particular situation.

If you live in or around the metropolitan area of Fort Lauderdale, Florida, contact us here today at .We will help you find a bankruptcy attorney in your area that will help you with any questions you may have on bankruptcy law.

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