One of the reasons many people delay filing bankruptcy is a fear that they will lose all their assets. In particular, people tend to worry about their personal vehicles, which they may need to work, and their homes. Thankfully, the state of Louisiana has common sense laws in place when it comes to the amount of property that a person filing for bankruptcy can retain. If you worry about the potential sale or seizure or your assets when filing bankruptcy, speaking with an experienced Louisiana bankruptcy attorney is your best option. Your attorney can help you understand your options and exemptions.
For those with low income, high debt or other serious issues, Chapter 7 bankruptcy is often the best choice. Debt consolidation may create an unsustainable debt issue, while Chapter 13 may not offer enough relief when you're struggling financially. Your attorney can help you decide what option is best. If you qualify for Chapter 7 under the state means test and decide to file Chapter 7 bankruptcy, your attorney can help you take the necessary steps to ensure you receive discharge. An attorney can also help protect your most valuable possessions during the complicated bankruptcy process.
Certain amounts of equity are exempt during bankruptcy proceedings
In the state of Louisiana, the law protects equity in both your home and personal vehicle, to a degree. The courts could order the sale of assets over the limit to help pay your debts. That could include withdrawing equity from either your vehicle or your home to help pay for existing debts. Thankfully, the law protects a substantial portion of your ownership interest in both when you file Chapter 7 bankruptcy.
When it comes to a personal vehicle, your interest up to $7,500 is exempt. If there is a second vehicle that has been adapted for disability usage, such as wheelchair accessibility, it is also exempt for up to $7,500.
Your equity in your primary home is also exempt, up to a point. Second homes and investment properties may be subject to sale or liquidation as part of Chapter 7 proceedings. When it comes to your primary residence, however, up to $35,000 in equity is protected as exempt when you are going through Chapter 7 bankruptcy. If you have more established equity than that, the courts may require that you liquidate some of that equity to help repay creditors. If your debts are due to a catastrophic accident or illness, more equity may be protected. Your attorney can advise you if this applies to you.
A bankruptcy attorney can protect your equity
Bankruptcy can be a frightening process. Working with an experienced Louisiana attorney is the best way to protect your equity and your financial future when you have to file bankruptcy. Don't risk losing more than you have to in order to get a fresh start. Speak with an experienced bankruptcy attorney today.
Source: Nov. 30, -0001