u/Equivalent_View_8202

Before I start: I know this is a shitty circumstance and I won’t ever get into debt again.

With that being said, I’m trying to understand how Chapter 7 would typically apply in a specific situation before speaking with an attorney.

Here’s my situation:

• Home value: about $215k–$230k

• Mortgage balance: around $170k

• Equity: roughly $40k–$50k

• I previously tried to sell for 8 months and it didn’t sell, so I switched to renting it. It rented quickly and I currently have a good tenant. Rent is covering the mortgage right now

I moved out of state for school (Kansas) and I’m a full-time student until May 2027. I have no steady income right now. My income after graduation: ~$60k–$70k. My plan was to move back into the home after school for a few years to get back on my feet, but I’m realizing that I’d be going backwards in pay and in technology when it comes to my field in medicine as a technologist. The opportunities outside of Louisiana is much better

• Debt:

– ~$41k credit card debt

– $7k additional credit card

– $28.5k car loan

– $28k private loan

What I’m trying to figure out:

I’m considering filing Chapter 7 while I’m still in school to clear the credit card debt and reset my finances. I understand student loans will not be discharged so I did not include them.

I am reviewing Chapter 7 as a potential filing during my current low-income period to address unsecured debt.

My focus is understanding how the home would typically be treated in a case like this:

• How is equity evaluated when the property is no longer owner-occupied and is rented?
• Does current rental use change homestead exemption treatment in most jurisdictions?
• At what level of equity does a trustee typically become interested in liquidation?
• In practice, is it common for filers in similar situations to retain the property while discharging unsecured debt?

Goal is to understand how this fact pattern is generally handled in Chapter 7 before consulting counsel.

Thank you.