Hi I was looking into fileing bankruptcy. I checked out chapter 7 and 13. Most everything says that you can keep your home and get the interest rate and monthly payment lowered. Well what if I wanted to file bankruptcy and not keep my house. How would that work? I live in Alabama. My biggest problem is that my mortgage payment is way too high and so far I'm 2 months behind with a 3rd payment due March 1st. I'm trying to weigh all of my options.

The trick in Chapter 7 is the budget. If you are moving and lowering your housing costs, you will need to increase your other budget items or reduce your income to prevent being forced into Chapter 13. I have never heard of modifying the interest rate or monthly payment in the course of Chapter 7; usually one would either discharge the debt and loose the collateral, or reaffirm the debt.

Well basically what I'd really like to do is move out of the house and get rid of it or let the bank have it or whatever and also claim my debts on the bankruptcy. Is that possible, and which bankruptcy would I use to do it? Also I am currently married but everything is in my name would I have to use his income or if I was divorced would it beneif me better with using only my income? I have no clue about this topic and need as much info as possible.

You can file a Chapter 7 (or 13) either Individually or Joint; the filing fee is the same. If you are married and file individually, you will still disclose your spouse's income and budget, though he is not a petitioner.