For most people, the option of filing for bankruptcy is not considered lightly. Especially when filing for Chapter 7, people are concerned with what the bankruptcy exemptions will be and what will happen to their property. These exemptions allow filers in Florida and other states to get a fresh start on their debt while being able to keep a certain amount of their possessions.
One of these exemptions is called the homestead exemption. Of course, the home is the most concerning when it comes to the property that may be lost during bankruptcy. Luckily, there are exemptions that allow the filer to keep his or her home in most states. There is usually a limit to how much that exemption is worth, however. The federal exemption is $20,000, while state exemptions vary.
Another piece of property that people often worry about losing in a bankruptcy case is their automobile. The good news is that there is also an exemption for the filer’s car. Just like it is with the home, however, there are limits to the amount of the value of the car, and states vary on that amount. As of 2010, the federal cap was set at just over $3,000.
There are also some items of personal property that are exempt in Chapter 7 bankruptcy. Items such as clothes, jewelry, appliances, furniture and others are usually exempt in these cases. Of course, there are limits on these as well.
There are other bankruptcy exemptions known as wild card exemptions that may also apply in Chapter 7. Each state has its own rules about which items may be considered wild card items. For those who are considering Chapter 7 in Florida, a bankruptcy attorney can explain these exemptions and how they would affect the filer.
Source: findlaw.com, “Bankruptcy Exemptions: Chapter 7“, Accessed on July 17, 2017