How could I make it feasible to buy a home now but file bankruptcy soon after and claim a homestead exemption while there is still 0 equity?

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How could I make it feasible to buy a home now but file bankruptcy soon after and claim a homestead exemption while there is still 0 equity?

I have approximately $13,000 in miscellaneous bills from my unemployment period (3 years) and am thinking about filing bankruptcy to stop garnishments and creditor harassment. Since that time, I have worked 9 years at the same company and am currently paying off my student loan and 2nd automobile loan. However, I recently gained custody of my teenage son and the small one bedroom apartment no longer meets our needs. I would much rather put this money into a 2-3 bedroom house. I could borrow approximatley $6000 from my 401k to use towards a downpayment.

Asked on June 28, 2012 under Bankruptcy Law, Minnesota

Answers:

FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

I suggets that the best way to ascertain your credit worthiness to purchase a home is to consult with a mortgage broker to make a loan application to various lenders and see if you would be able to be pre-qualified for certain loan products. From there you then look for homes in your qualification range.

Another option is to see if a seller of a home would be willing to do a seller carryback of a loan to you for the purchase of his or her home. I suggest that you may want to consult with a real estate attorney further after you have gone through the pre-qualification process for the suggested loan that you want to assist you in the ourchase that you want to make.


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