When a person is going through bankruptcy proceedings, the habitual residence and the payment exemption model is one of the biggest concerns. Therefore, it is necessary to know well how this process works, especially, to keep the habitual residence in property and not have to suffer an eviction. Therefore, the first thing to look at is the Second Chance Law and how it is contemplated, within the regulations, the exoneration of unsatisfied liabilities.
Within Title XI, in Chapter II, of the aforementioned Law, the ways in which the debtor can request the exoneration of his debts through a payment plan or by liquidating the active mass are delimited. Although, a third scenario is also contemplated, in which the exoneration of debts without active mass can be requested.
Returning to the modality of payments and the maintenance of the habitual residence, the new regulations of the Bankruptcy Law have brought important news that should be known. And it is that, now the possibility of obtaining the aforementioned exoneration is allowed without having to liquidate the estate. In this way, the debtor can keep his home by establishing a payment plan.
Thus, and with the Law in hand, it can be affirmed that the potential exoneration debts have been expanded by introducing the path of a payment plan so that both the habitual residence and the business assets are preserved. Previously, this possibility did not exist and forced the liquidation of the assets to face the debts.
What the new regulations have stipulated is that in this payment plan a new payment schedule is established for those credits that are considered to exonerate them, here the homes in which a mortgage is being paid apply. In addition, a planned resource relationship must also be created for this payment schedule to be executed in order to have certain guarantees.
Although, in the establishment of this payment plan, the debtor can decide whether to dispose of his home or not. If he wants to keep it, then he must stick with it and stick to the schedule.
To maintain the habitual residence when accessing the Second Chance Law or accessing a payment plan, different aspects must be taken into account. For example, the valuation of the home, the existence of a mortgage and its amount and the situation in which the loan is located, since it may have already been previously unpaid.
Once this is clear, the aforementioned payment plan to continue maintaining the home must continue to pass several filters to be approved. The first thing is that the Judge admits this payment plan and, secondly, that the creditors do not challenge this as they may be affected when it comes to recovering their debts.
Regarding the first, the approval of the payment plan by the judge, the most important thing is to present a real proposal adapted to personal circumstances. Here they must take into account the volume of credits to be paid, the income that they have and their own resources for compliance.
Whereas, for the aforementioned possible challenge, this can come in the event that the payment plan does not guarantee at least the payment of the part of your credits that would have to be satisfied in the bankruptcy liquidation; when the payment plan does not include the realization and application to the payment of the exonerable debt; When the opposition to the payment plan is verified by creditors representing more than 80% of the exonerable debt; or when the plan does not allocate all the foreseeable income and resources to satisfy the exonerable debt.
Lastly, if liquidation is chosen, maintaining the habitual residence becomes more complex, but not impossible. Since within the Law certain assumptions of assets and rights that cannot be seized are contemplated, although mention is also made of those mortgaged.
