Comments on: Bankruptcy Exemptions – What happens to our house. http://www.bankruptcy-edmonton.com/bankruptcy/2008/09/bankruptcy-exemptions-what-happens-to-our-house.html Bankruptcy Edmonton Tue, 07 Feb 2012 15:47:45 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: Barton Goth GCO Bankruptcy Trustees http://www.bankruptcy-edmonton.com/bankruptcy/2008/09/bankruptcy-exemptions-what-happens-to-our-house.html/comment-page-1#comment-243 Barton Goth GCO Bankruptcy Trustees Wed, 17 Sep 2008 14:17:43 +0000 http://www.bankruptcy-edmonton.com/bankruptcy/2008/09/bankruptcy-exemptions-what-happens-to-our-house.html#comment-243 This largely depends on the amount of equity. If your equity is less than $40,000, then you have no problem as this is the amount allowed to be protected in the province of Alberta. However, if you have greater than $40,000 in equity then there is value that legally belongs to the creditors. This means that somehow the trustee must realize on this equity and distribute it among the general body of creditors. This could mean selling the house, it could mean you take a 2nd mortgage against the house for the different, but either way the money must be realized on behalf or the unsecured creditors. This largely depends on the amount of equity. If your equity is less than $40,000, then you have no problem as this is the amount allowed to be protected in the province of Alberta.

However, if you have greater than $40,000 in equity then there is value that legally belongs to the creditors. This means that somehow the trustee must realize on this equity and distribute it among the general body of creditors. This could mean selling the house, it could mean you take a 2nd mortgage against the house for the different, but either way the money must be realized on behalf or the unsecured creditors.

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