When bankruptcy seems the only way out for getting rid of debts, people become concerned about their assets including home, car and other personal property. Los Angeles based bankruptcy law firm Recovery Law Group lawyers say that many people are concerned whether they will end up losing all of their personal possession during bankruptcy. Generally, thanks to bankruptcy exemptions provided by federal and state governments, people can protect some amount of assets. The amount of property you can exempt depends on the state you live in and how long you have been living there.
The state of Florida allows bankruptcy filers to use state exemptions if they have lived in the state for a minimum of 2 years. With some changes in the state exemptions, people can protect many of their assets. Earlier (till 2007), Florida residents could exempt vehicles with $1,000.00 equity and personal property worth $1,000.00 apart from homestead property. Since many debtors lacked homestead property, this exemption went waste. With CS/SB 2118 bill being passed a change was made in the homestead exemption portion. With this change, the “homestead” was changed to allow “homestead or $4,000.00 worth of additional personal property.” This became possible thanks to Douglas Neway who is the Chapter 13 trustee. His job, incidentally, is to collect money from the debtor to distribute it amongst creditors.
In case of a Chapter 7 bankruptcy, if your personal property exceeds the exemption amount, the option of a “buy-back” plan is available. Through this plan, the trustee is provided with a practically possible monthly payment so that you can keep the property. In case you can’t make the agreed-upon the monthly payment, you have the option of either surrendering the property or having your discharge revoked. In the case of Chapter 13, this is a routine part of the repayment plan.
Personal property can also be kept safe from the trustee by getting it exempted through “Tenancy by the Entireties.” This is a unique form of owning a property which requires a couple to be married and debts be allotted in a specific way.
If you wish to know more about the ways to protect personal property during bankruptcy, you should schedule a consultation with experienced bankruptcy lawyers by calling 888-297-6023.