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The purpose of bankruptcy exemptions

Louisiana residents who are facing financial hardship may be looking at ways to achieve debt relief. Many people avoid bankruptcy because they fear losing everything and being left destitute. However, the intention of the U.S. Bankruptcy Code is to provide victims of unanticipated and costly emergencies with opportunities to re-establish financial stability and have a fresh start.

Understanding the concept of exemptions may help consumers to see how bankruptcy can be a remedy. If the filer loses all the necessities for life in bankruptcy, the offer of a fresh start will mean nothing. For that reason, the filer will always be allowed to hold onto enough property or assets to continue supporting his or her family. The assets that will be safe from liquidation are called exempt property.

These will always be essentials and not luxuries. It may include the family home, furniture, kitchen items and clothing. Furthermore, items required to continue earning a living such as a vehicle and tools required for working in a particular profession or trade will be exempt. Also, a portion of earned wages, support benefits such as alimony or child support, and other essential items will also not be taken away. These exemptions are only valid for personal bankruptcy filings and not for businesses that file for Chapter 7 bankruptcy.

These are but the basics, and it may be appropriate to arrange a consultation with an experienced Louisiana bankruptcy attorney to learn more. A lawyer will know the intricacies of the state and federal laws governing bankruptcy exemptions, and he or she can provide the information required to make informed decisions. Choices made at this time can affect the client's future, and the seasoned guidance and support of a skilled attorney might lead to the fresh start that was anticipated.

Source: thebalance.com, "Understanding Bankruptcy Exemptions", Carron Armstrong, Accessed on Jan. 20, 2017

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