How Can I Protect My Assets In A Consumer Bankruptcy Case?
If you are considering filing for personal bankruptcy in Orlando, you might also be thinking about your options for protecting your assets. Whether you have done your own research into the topic of consumer bankruptcy or have a friend or family member who has filed for bankruptcy recently, you might have gathered information about the bankruptcy process that is not entirely accurate or that is not applicable to your case.
Our experienced Orlando bankruptcy attorneys often speak with clients who have many misconceptions about personal bankruptcy and the steps they need to take in order to protect their assets. We want to provide you with some of the information you will need as you begin the process of planning for bankruptcy.
You Will Not Need to Protect Assets in a Chapter 13 Bankruptcy Case
The first thing to know is that asset protection is not necessary in all types of bankruptcy cases. To be sure, if you are planning to file for Chapter 13 bankruptcy, you will not be at risk of any of your property being liquidated in order to repay creditors. This type of bankruptcy is known as a wage-earner’s bankruptcy because it involves reorganizing or restructuring debts and paying them off over a period of time. With a Chapter 13 bankruptcy case, you will develop a repayment plan that will last for a period of anywhere from three to five years, and the payments you make during that time will go toward repaying secured debts and priority debts.
As soon as the terms of your repayment plan are over, your remaining eligible debts can be discharged as long as you met the terms of the repayment plan. To be clear, none of your assets will be liquidated at any point in time during a Chapter 13 case.
You Have the Ability to Protect Assets in Your Chapter 7 Bankruptcy Case
If you are planning to file for Chapter 7 bankruptcy, you should be prepared that non-exempt assets will be subject to liquidation as part of your bankruptcy case. Since Chapter 7 bankruptcy is a type of liquidation bankruptcy, assets can be liquidated to repay creditors prior to your discharge. However, Florida’s bankruptcy exemptions allow you to protect a variety of assets from liquidation.
Which assets are you able to protect with Florida bankruptcy exemptions? There is a long list of possible exemptions that you should discuss with an experienced bankruptcy lawyer. For examples, those exemptions allow you to:
- Protect equity in your home with the homestead exemption, which allows a Florida homeowner to exempt an unlimited amount of equity in a home (and thus can allow you to protect an entire home residence if your mortgage is paid off);
- Protect up to $1,000 in a motor vehicle;
- Protect education and health savings accounts;
- Protect $750 per week of your wages; and
- Protect $1,000 of personal property, or $4,000 of personal property if you do not claim the homestead exemption.
Contact an Experienced Orlando Bankruptcy Lawyer
If you have questions about protecting assets in bankruptcy, our experienced Orlando bankruptcy lawyers can help. Contact Anderson & Ferrin for more information.