As a Chicago bankruptcy attorney, I am often asked by a client if they should give up their home. Well as with anything, the answer depends on a lot of factors. In this article by MSNBC, it speaks about a strategic default and that more borrowers are doing it because of the fall in home prices. A strategic default is when a borrower walks away from their mortgage when they have the ability to pay it. There are a number of issues with strategic default and it makes sense to speak with an experienced attorney if one is going to undertake it. There can be a number of issues such as tax implications as well as a possible deficiency on a mortgage which in some states could lead to a garnishment or the loss of other assets. Generally speaking if the person is significantly underwater on their home it sometimes makes sense to let the property to go into default and through foreclosure. However, in some circumstances a bankruptcy such as a Chapter 7 liquidation or a Chapter 13 may make more sense for the borrower depending on their circumstances. If you are having financial hardship please call my office for a free consultation to discuss your options with an experienced Chicago bankruptcy lawyer at 312-489-8182!

Marc