Most people who consider bankruptcy are experiencing a severe financial downturn, and they take the filing decision seriously. Where Chapter 7 is concerned, many fear that they will lose their assets, cars and homes if they do file. While Chapter 7 St. Louis MO provides a fresh start, it doesn’t force a person to start over again with regards to their assets. Bankruptcy exemptions offer a measure of reassurance to worried filers, and some of these exemptions are listed below.
Types of Exemptions in Chapter 7
Some refer to Chapter 7 as liquidation bankruptcy because it involves the seizure and selling of some of the filer’s assets to pay debts. However, today’s bankruptcy laws protect some types of assets from liquidation. This protection is known as an exemption, which can cover an entire class of assets, or it can be highly specific. Sometimes exemptions are established by state law, and sometimes they are governed by Federal law. Filers should consult a bankruptcy attorney to learn which set of exemptions will apply.
* Homestead exemptions protect one of the filer’s main assets. There’s a limit to the exempt amount; federal exemptions are capped at roughly $20,000, and state exemptions vary widely.
* Cars are sometimes protected, but state and federal laws impose limits on these exemptions.
* Personal property may be exempt from inclusion in a bankruptcy estate. Clothing, furniture, home appliances and jewelry are protected, but per-item limits may exist.
* Wild card exemptions cover property that doesn’t fall into another category, or assets that exceed their group’s maximum value. However, these exemptions are limited in value and availability.
Consult an Attorney for Bankruptcy Exemption Advice
If a person is considering filing for Chapter 7 St. Louis MO, they should learn more about the protections offered by the bankruptcy exemptions shown above. Determining which exemptions and rules apply to each property type can be complex. Therefore, for most filers, it is a wise decision to consult a bankruptcy attorney who can help them navigate the legal system. Attorneys with Website.com can help clients protect as much property as possible while providing courtroom representation if necessary.