What is Chapter 7 Bankruptcy
Chapter 7 Bankruptcy will wipe out all your debts except those which are Student Loans and IRS Taxes. Basically it is I have nothing, I pay nothing. Obviously the I have nothing doesn't mean you don't have a home or a car or furniture or employment. In Florida we have three basic exemptions. We have the Homestead Exemption, which protects the equity of your home so long as you have owned it for more than 1215 days (about 40 months) , the equity you have is not limited for this exemption. So lets say you have a home and you have owned it for 10 years, and its paid in full, since you have lived there for more than 1215 days, then the whole value of the property is protected from creditors. The contents of the home and the personal belongings have a $1,000.00 exemption. This may sound low, but keep in mind that old furniture , or old clothes , etc. have devaluated very quickly and are worth much less than what you paid for. There is also the vehicle exemption which is $1,000.00. This means that if your car has more equity than $1,000.00, you may have to pay back the Trustee the excess value if you want to keep the vehicle, or surrender it. Also, if you don't own a home, then there is the wildcard exemption , which allows you to have an additional $4,000.00 exemption. So if you were over exempt in your car by $3,000.00 you could use the wildcard to protect it and still have $1,000.00 left for any other over exempt property. Finally , there is the Tenants by the entireties. If you are married and you have purchased a real estate property or any personal property together, then it is considered Tenants by the entirety and protected if one of the spouses is not filing bankruptcy. As a recommendation, I many times see couples that purchase a car and its titles for example John Doe or Mary Doe. In this scenario its not protected because of the "or", if it had been "and" tenants by the entireties would apply and if one of the spouses is not filing then the asset is protected regardless of the equity. We can help you. Call us .