People file for federal bankruptcy protection for many reasons. Some people file because they have run up hundreds of thousands of dollars in doctor’s bills that they can’t pay back. Other people file for bankruptcy protection because they can’t afford to pay their credit card bills on time. When people face these situations they often elect to file for bankruptcy protection to eliminate debt loads.
To do this, consumers will often hire bankruptcy lawyers to help them consider their legal options. This happens because there are several viable bankruptcy options that can help consumers eliminate debt legally. These options are complicated to execute by yourself. Consumers quickly realize that it’s a good idea to hire a bankruptcy lawyer to help with the process.
Once the bankruptcy attorney helps the consumer decide on how to proceed, the consumer files a petition for bankruptcy protection in federal court. This petition lists their current income, assets and debts. This information is used to determine if bankruptcy is a viable option to eliminate debt. If this is the case, most consumers are often afraid to proceed with their bankruptcy case because they think that they could lose everything they own in the process.
Thankfully, this need not be the case. Most bankruptcy lawyers can help their clients protect their assets by using their state’s bankruptcy exemption laws. These laws allow consumers to exempt certain assets from being used to pay back a consumer’s debts during the bankruptcy process. These state bankruptcy exemption laws vary across the country.
State laws often offer more exemption options for consumers than federal exemption laws that also exist. As a result, many consumers can use their state’s bankruptcy exemption laws to protect more of their assets from creditors during the bankruptcy process. Here are two examples of how state bankruptcy exemption laws protect assets from creditors during the bankruptcy process. The rules can be quite different depending on what state you live in.
The state of Massachusetts has several bankruptcy exemptions that allow people to protect many assets. For example, they allow residents to exempt their home and the land it sits on if its total combined value is less than or equal to $300,000. In addition, Massachusetts allows consumers to protect up to $3,000 worth of home furnishings, up to $500 worth of tools used in a trade and up to $700 of the value of a person’s vehicle.
Another example worth considering is Nevada’s bankruptcy exemption laws. Nevada offers several exemptions that can help residents keep more of their assets. For example, consumers can exempt up to $125,000 of their primary home’s value. Nevada residents may also exempt 100% of the value of their clothes, family heirlooms, alimony payments and qualified retirement accounts.
As you can see, consumers can use their state’s bankruptcy exemption laws to help them protect their assets from creditors. Since they vary widely across the country, it’s a good idea to consult with a bankruptcy attorney to see how they can be used effectively. Most bankruptcy lawyers are willing to do this. As a result, consumers can feel more comfortable about the bankruptcy process knowing that their assets can be protected from creditors.
For more information about the pros and cons of filing bankruptcy contact the bankruptcy lawyers at LegalHelpers.com. LegalHelpers has helped thousands of people eliminate millions of dollars of debt and they can help you too.