Questions..

[Confused78]

My brother is looking to file in the near future but we are clueless as to what is going to happen. Little info...
-He was diagnosed with MS last year and has about $500.00 left in medicial bills (he already pd. around $1,000.)
-Has credit card debt
-Company he worked for the last 15 years closed their doors, so at the end of the month he is out of a job
-Co Owned house he just purchased with my father in Jan 08 (they live in it together) around 100,000
-owns, boat and van that he is still paying on
-not married and no kids
-lives in PA

So some questions are, can he keep the house he owns with my father? Not sure if the loan is just in my dads name or in both. I know that both of their names are on the deed. He is not worried about his van or the boat, they can take that. He doesn't want to lose the house though. So is this going to get messy? Thanks

[dingdong]

It would help a lot if you posted how much equity is in the home, what state your brother is in and what your state's homestead exemptions are in your bros state as well as if there are any wildcard exemptions.

[Confused78]

He lives in PA
I doubt that there is much equity at all in the home. Maybe 25,000 at the VERY most! I would guess they would be extremely lucky to break even at this point though.
Thanks for replying.

[dingdong]

In PA you have the choice of using the Fed exemptions or the state.

It looks like the PA state exemptions have no allowance for homestead exemptions.

The fed is:
Homestead
Real property, including co-op or mobile home, to $17,450; unused portion of homestead to $8,725 may be applied to any property
(d)(1)


With an additional wildcard of:
WILD CARD
$925 of any property

Up to $8,725 of unused homestead exemption, for any property
(d)(5)

(d)(5)


So 18375 of equity would be protected if he didn't use the additional WC of 925 on anything else he wanted to exempt, IF he went with the fed exemptions

I found this infor here http://www.pennsylvania-bankruptcy.com/fed.html

[Confused78]

Thanks so much for all the info.

Maybe you can help me answer a few more questions...
since he co owns the home will they only count half the equity of the home as his? Will it make the process harder if he goes with the federal exemption? It says wages "none" does that mean that they can take his wages? Of course till then it will be unemployment.
Thanks

[dingdong]

Unemployment wages are exempt using the Federal exemptions.

I didn't check the PA state exemptions.

I am not 100% sure about the 1/2 home equity issue, I suppose if they are both on the deed , each with 50% ownership, then the equity would be split?

I don't own a home, so never researched the issue, someone else here should know.

Choosing Fed over State isn't harder, it just depends on what you need to protect, and what assets you have and which may be more important to protect.

Looks like PA has some pretty crappy exemptions from what I read. Especially no homestead exemption.

[StartingOver08]

Also remember, there is no equity if the loan value exceeds the actual fair market value. Most people assume their homes are worth more than they are really worth. Get the value from a realtor using closed sales within the last 90 days. They will give you this value in a CMA. Tell them you want the quick sale value (properties sold in less than 60 days on market - in order to get this value, usually the sale is a distressed sale and is at the low end of the market range). This is a free service. Don't put in the taxable value - it is typically too high now.