For many bankruptcy filers, one of the main concerns is whether they will lose any property when they file bankruptcy. A common bankruptcy myth is that you will lose most of your property if you file bankruptcy. This is simply not true. Most people who file bankruptcy keep all of their property while erasing thousands of dollars of debt. Bankruptcy is often the best option for someone who does not have any money left over each month after paying living expenses to pay their debts.
Many of our clients have timeshares that they purchased because they wanted to ensure their family would have a vacation spot each year or they were convinced by a sales representative that it was a good investment. While some timeshares may be good investments, many of them cost much more than they are worth. The truth of the matter is that a timeshare is only worth what someone is willing to pay for it. Although a timeshare may not be worth very much right now, it is still an asset that must be disclosed in your bankruptcy filing.
Will I Lose My Timeshare If I File Bankruptcy?
A typical timeshare gives you an ownership interest in a resort that allows you to use the property for a specific period of time each year. Some timeshares use a system that allows for some flexibility as to the location and dates you choose each year for your vacation while others assign a specific property and week each year. Regardless of how the timeshare works, you must disclose your interest in the timeshare in your bankruptcy.
You may be able to retain your timeshare if the equity in the timeshare (the value of the timeshare less any liens) is covered by your available exemptions and you can afford to continue paying the lienholder. You must also be able to afford to pay the fees and other costs associated with maintaining the timeshare. Filing bankruptcy will not release the lien on a timeshare or release you from the liability for fees and other costs if you choose to keep the timeshare.
In many cases, debtors choose to surrender the timeshare to the lienholder and/or the managing company in order to erase the debts associated with the timeshare. This releases the debtor from any further liability with regard to the debt on the timeshare. Because some timeshares invest ownership in a specific piece of property, you should provide your attorney with copies of your timeshare documents to review before discussing your options for handling the timeshare in your bankruptcy.
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The Law Office of Travis J. Richards, LLC is a full-service Mount Holly bankruptcy law firm focused on Chapter 7 Bankruptcy, Chapter 13 Bankruptcy, debt consolidation, credit repair, tax liens, student loans and foreclosure. We represent clients in Burlington County and throughout South Jersey.
Contact our office at 609-267-5297 to schedule your free consultation to discuss bankruptcy and non-bankruptcy alternatives. You may also use our convenient online contact form and one of our friendly, professional staff members will contact you to answer your bankruptcy questions and/or schedule a free consultation with Travis J. Richards.
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