You might be here because you’re in the middle of a financial dilemma. Perhaps you are wondering if it could ever be possible to buy or sell a house while in bankruptcy. Fortunately, we are here to help you out with that. Read on to learn more.

Selling Your House after Declaring Bankruptcy

Indeed, this is possible. As your home may be listed in the bankruptcy, your bankruptcy lawyers will then file a motion to sell the property after a selling agreement has been achieved. The court should sanction the sale as long as the proceeds are sufficient to cover realtor costs, transfer taxes, and the mortgage.

Bankruptcy and a Foreclosure Home

Your home and other possessions are included when you declare bankruptcy. Creditors cannot foreclose on your property since it is protected by bankruptcy, but you cannot sell it without court consent. To satisfy your debts, the trustee may petition the court to order the sale of your home.

Understanding Chapter 7 and Chapter 13

Home sales are hampered by Chapter 7 bankruptcy (asset liquidation). Selling necessitates judicial approval. Before selling your house to pay off creditors, the court-appointed trustee must acquire approval from you. Chapter 13 bankruptcy (reorganization) permits you to keep or sell your home without harming your lender. In order to sell or refinance your house in Chapter 13, you must first receive permission from the trustee.

Understanding “Motion to Sell Real Property”

A Motion to Sell Real Property must be filed in order to sell a home in bankruptcy. The property’s selling price and debts must be included in the formal motion. You must also advise the court of your plans for the money you will earn after selling your property.

Understanding Trustee Sale Approval

To settle creditors, the court-appointed trustee may sell a residence. Trustees must disclose all property information, including the projected revenue distribution. Furthermore, the trustee must persuade the court that the transaction would not harm the petitioner. In most states, half or all of the value of a home may be “exempt,” lowering trustee-requested sales.

Filing for Bankruptcy as a Homeowner

Can a person who owns property declare bankruptcy and lose it? Before filing Chapters 7 and 13, determine whether you can keep your home.

It is widely believed that filing for bankruptcy will result in the loss of all your valuable assets, including your home. This could be preventable. Thus, learn when you might lose a property, how exemptions preserve home equity, and why Chapter 13 is a better option for protecting your home than Chapter 7.

Losing Your Home after Declaring Bankruptcy

If you can’t afford your mortgage, declaring bankruptcy won’t help you keep your home, and catching up on past-due payments will be difficult. You will lose your home in Chapter 7 bankruptcy if you have an excessive amount of home equity or if you are unable to pay your Chapter 13 creditors an amount equal to the unprotected equity.

What to Know about Bankruptcy Exemptions

There are some assets that are not subject to bankruptcy.

Creditor exemption rules protect your assets from creditors. The exemption laws allow you to keep items that you and your family need for work and at home.

The bulk of state exemption regulations applies to situations other than bankruptcy. Other types of creditor litigation are exempt. You will know what you can hide from creditors before, during, and after bankruptcy if you are familiar with your state’s exemption requirements.

Simply examine your exemptions to see if they protect your home equity and other assets. 


As you live life as a responsible adult, know that your finances play a big role in securing your future as well as your family’s future. This means you must do what you can to avoid financial mistakes that may tragically lead to bankruptcy and losing your home. In the event you or a loved one is going through a tough time financially, make sure you keep all this information in mind.

Do you want to sell your house fast in Texas? Greenlight Offer is here to help you maximize the value of your home. Work with us today!