One of the greatest misconceptions regarding bankruptcy is that filing will cause a person to lose their home and assets. Contrary to popular belief, New York offers people who file for Chapter 7 bankruptcy certain exemptions that allow them to protect their home and certain assets from creditors. Depending on the specific county, a person is allowed to protect their house, condominium, mobile home, or co-op up to a value of $150,000. Additionally, up to $10,000 worth of personal property can be protected.
The following can all be protected against creditors:
- Cell phones
- Jewelry up to $1,000 in value
- Motor vehicles worth up to $4,000
People who file for Chapter 7 bankruptcy must choose between either federal or state exemptions, though they may not mix the two. New York's state exemptions allow more flexibility for homestead and life insurance exceptions, while the federal scheme provides a more generous wildcard exemption. In both cases, however, a person is allowed to keep nearly all of the funds in their retirement accounts.
Those who file for Chapter 13 bankruptcy can avoid liquidation altogether. Instead of selling assets to repay creditors, Chapter 13 bankruptcy involves a re-organization of a person's finances and the establishment of a three to five year repayment plan. While only certain debts can be discharged, this method allows a person to keep their assets under the condition that they strictly adhere to the court's preapproved plan.
Contact a Bronx Bankruptcy Attorney – Call (718) 354-8027
If you are struggling to get by due to overwhelming debt, a Bronx bankruptcy lawyer from the Law Offices of David Brodman can guide you through the process of Bankruptcy towards a debt-free future. With more than 15 years of dedicated legal experience and a track record of more than 5,000 bankruptcy cases handled, we are equipped with the skills and experience you need to help you get through this difficult time as smoothly as possible.