Implementing a solution for your debts does not mean that you have to lose the things your family values most. Our team of professionals will provide you with the information necessary to protect your assets and advise which exemptions may be available.
It starts with exempt property
To understand what property is protected from creditors, you (or your attorney) must understand the laws of your state for what’s called “exempt property.” While bankruptcy laws are federal statutes, the court will look to state exemptions to determine which assets you can protect from creditors. The most commonly applicable exemptions in California:
- Vehicle – $3,525
- Homestead exemption – $22,000
- Wildcard exemption – $23,000
Keeping your car after filing for bankruptcy protection
How is it possible to keep a car after bankruptcy? Let’s say a debtor has a vehicle with a fair market value of $7,000 titled in the name of a debtor. The debtor owns the vehicle free and clear of liens. The debtor could keep the by using $3,525 exemption and the wildcard exemption to protect the rest.
Changing the facts slightly, where the same vehicle was financed with little or no money down, and the debtor is making payments and the lender has a lien on the vehicle. As long as we can show an ability to make payments, the debtor will keep the vehicle.
Another scenario is a debtor who owns a vehicle with a fair market value of $10,000.00, free and clear of liens. The debtor could keep the car if using $3,525 vehicle exemption and the wildcard exemption to protect the rest.
Your car is one piece of a much bigger puzzle
Families throughout the Inland Empire are finding it difficult to make ends meet with increasing unemployment and declining property values. For those individuals, a counseling session can explain and debunk the myths about bankruptcy and help them make the best decisions for themselves and their families based on consumer laws and exempt property statutes.