A recent free consultation came into my Miami bankruptcy office to discuss options regarding her Condo Association foreclosure lawsuit filed against her.
She did some reading about bankruptcy options but wanted to sit down to discuss how we could save her home.  I informed her that there are a few Chapter 13 bankruptcy options that could help her save her home from the association foreclosure:

Strip or Remove an Association Lien in Bankruptcy

The first option that I gave her was to file a Chapter 13 bankruptcy to strip or remove the association arrearage in the bankruptcy and just pay going forward.  In order to strip an association lien, a debtor must show that the value of the condo is less than the first mortgage on the property.  For example, if she owed 200,000 on her mortgage but the property was only worth 100,000 she would be able to strip the lien in a chapter 13 bankruptcy.  However, if the property was worth 200,000  and her mortgage was only 100,000 the debtor would not be able to strip the lien.

Play Catch Up on the Arrearage

If a debtor isn’t able to strip or remove the association lien by filing a Chapter 13 bankruptcy then she has the ability to play catch up on the arrearage.  A Chapter 13 bankruptcy plan is either a 36-month plan or a 60-month plan and basically the debtor would divide what she owes over either 36 or 60 months and play catch up for that period of time.  For example, if the debtor owed 10,000 and was in a 60-month bankruptcy she would play catch up by paying 166.66 toward the association lien for 60 months.

If you are thinking of filing for bankruptcy in South Florida and would like to speak with an experienced Chapter 7 and Chapter 13 bankruptcy attorney then please contact Shmucher Law, PL, and attorney Ofer Shmucher.  We offer free consultations seven days a week and can be reached at 954-309-5559 or 305-741-5553.