What Happens to My Home if I File for Chapter 7 Bankruptcy in Wyoming?

September 10, 2025

What Happens to My Home if I File for Chapter 7 Bankruptcy in Wyoming?

Filing for Chapter 7 bankruptcy in Wyoming can offer a fresh financial start, but many people worry about what will happen to their home during the process. The answer depends on several factors, including your home’s value, how much equity you have, and whether Wyoming’s exemption laws protect it.


Understanding Chapter 7 Bankruptcy in Wyoming


Chapter 7 bankruptcy, also called “liquidation bankruptcy,” involves selling certain assets to pay creditors. However, many assets, including a portion of the equity in your home, may be protected by exemptions. Exempt property cannot be sold by the bankruptcy trustee.


Wyoming’s Homestead Exemption


In Wyoming, the homestead exemption protects up to $20,000 of equity in your primary residence. If you own the home with a spouse and file jointly, this protection doubles to $40,000. Equity is the difference between your home’s market value and what you owe on your mortgage.

For example, if your house is worth $200,000 and your mortgage balance is $185,000, you have $15,000 in equity. That equity would be fully protected under the Wyoming homestead exemption, meaning you could keep your home as long as you remain current on your mortgage.


When You Might Lose Your Home


If your equity exceeds the Wyoming exemption limit, the bankruptcy trustee could sell the home, pay you the exempt amount, and use the remaining funds to pay creditors. Additionally, if you fall behind on your mortgage payments, bankruptcy will not erase your lender’s right to foreclose.


Keeping Your Home During Chapter 7


Most Wyoming residents who file Chapter 7 are able to keep their homes if:


  • Their home equity is within the state exemption limits.
  • They remain current on mortgage payments.
  • They continue to pay property taxes and insurance.


Conclusion


The impact of Chapter 7 bankruptcy on your home depends on your unique financial circumstances. Understanding Wyoming’s exemption laws is key to protecting your property.


At Wiggam Law Office, LLC, we can provide legal assistance to the Cheyenne public, helping you navigate bankruptcy while protecting your assets.

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