The Decision to Surrender Your Home During a Las Vegas Bankruptcy

The traditional wisdom for debtors in bankruptcy was to protect your home and discharge unsecured debts. In some cases, bankruptcy attorneys advised surrendering a vehicle and eliminating the monthly auto payment in order to afford the home mortgage. Back when real estate prices were appreciating at staggering rates, that wisdom was sound advice. It was important to protect an asset that was appreciating quickly and could be used to secure a family’s financial future.

Unfortunately, times have changed.

Over the past few years housing prices have flattened, or even depreciated. In many areas home prices have dropped significantly. For a debtor who is upside-down on a home loan, it usually doesn’t make sense to try to dig out of negative equity and continue to pay on a home that is a liability, not an asset.

If your mortgage is stressing your family’s budget, it may be wise to walk away. It is important to consider surrendering your home during bankruptcy and renting rather than continuing to pay a burdensome mortgage payment, taxes, insurance, home repairs, and maintenance. The question to answer is whether walking away will save you money in the short run and the long run.

One tool for this analysis is provided free of charge at Trulia maintains a rent vs. buy calculator that compares the cost of buying a home against the costs of renting. Using the calculator you can determine whether keeping your home is a smart financial decision. Trulia also publishes a Rent vs. Buy Index, which tracks whether buying a home or renting is less expensive in America’s 50 largest cities, based on current market conditions.

Deciding whether to walk away from a home is often difficult, but is an important consideration for any home owner facing bankruptcy. When a debtor surrenders property in bankruptcy there is generally no financial consequence to the debtor, and the debt is discharged by the bankruptcy court. If you are considering surrendering your home during bankruptcy, speak with an experienced Freedom Law Firm attorney and discuss the advantages and disadvantages of the process. Call 702-903-1354 to set up a free consultation. Your bankruptcy attorney can help you reach a decision that is right for you and your family.

0 0 votes
Article Rating
Notify of
Inline Feedbacks
View all comments


This website is an advertisement. The information presented at this site should not be considered formal legal advice nor the formation of a lawyer or attorney-client relationship. You are advised that the acts of sending e-mail to or viewing or downloading information from this website does not create an attorney-client relationship. We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code. Assistance we provide may include bankruptcy relief under Title 11.

Contact Us

Copyright Ⓒ 2021. Freedom Law Firm – All Rights Are Reserved.