Will I Lose All My Possessions if I File for Bankruptcy in Florida?

Being in debt can be scary but many people are also scared of the alternative: filing for bankruptcy. Bankruptcy can seriously lower your credit score. It can also cause you to give up your assets.

This can be a frustrating situation. However, it is important to remember that the goal of bankruptcy is not for the courts to take away all of your assets. You will not be left with nothing. In fact, bankruptcy is available to help protect your property from creditors. You will be left with some assets, but what exactly? You need to understand what assets are considered exempt, and what is not, and how exemptions apply in Florida.

Each state is different when it comes to exemptions. Some have higher exemption amounts that can be used to keep your house or vehicle. While the goal of bankruptcy is to get a fresh start, all assets will be evaluated, and they may be used to pay at least part of your outstanding debt.

In a Chapter 7 bankruptcy, non-exempt assets can be used to repay your debt. These include vehicles, houses, savings accounts, land, and anything of value, such as jewelry or artwork. Florida allows for the following exemptions:

• $1,000 for personal property
• $1,000 for a motor vehicle
• Disability benefits and income
• Most retirement accounts
• Health savings accounts
• Most government benefits
• Most public benefits

One of the most favorable exemptions, though, is the homestead exemption. Under Florida law, you can exempt all the equity in your home or other qualifying real estate. This is rare, as only five other states allow this.

There are two main requirements for qualifying for the unlimited homestead exemption:

1. You must have owned the property for at least 1,215 days before filing for bankruptcy.
2. The property cannot exceed 160 acres, or one-half acre in a municipality.

In a Chapter 13 bankruptcy, property does not typically get seized because you are using a payment plan. However, you can still use bankruptcy exemptions to your advantage. The exemptions can be used to protect the equity in your property while keeping your plan payment as low as possible.

Understanding exemptions can be complicated. You may not be aware of what you can keep and what must be seized and sold. A bankruptcy lawyer can help you with your case.

Contact Our West Palm Beach Bankruptcy Attorney Today

Bankruptcy can be a confusing process. You may be concerned about your possessions, but the good news is that you can keep some thanks to exemptions.

West Palm Beach bankruptcy attorney Brian K. McMahon, P.A. can answer your questions about assets. He can determine whether or not you will be able to retain ownership of your vehicle, home, or other assets once the bankruptcy is resolved. Schedule a consultation by filling out the online form or calling (561) 658-1789. We serve the West Palm Beach, Boca Raton, Port St. Lucie, and South Florida areas.