Bankruptcy Chapter 7 Exemptions - Why is it important
When debts are overwhelming, there may be only one alternative, which is to file for bankruptcy. Many defaulters choose to file for Chapter 7 Bankruptcy. In this chapter, all your non-exempted assets will be sold or liquidated which would gives you a way to pay off all your debts. This chapter is supervised by the authority and the court will appoint a a person known as a trustee to get sales from all the non-exempt assets owned by the debtor and use the sales proceeds to pay off the various creditors. Bankruptcy chapter 7 exemptions refers to assets that cannot be sold when the bankruptcy is filed. Chapter 7 bankruptcy is usually favored by debtors but not the creditors and with with the exemptions in place, a debtor can have a chance to reduce their personal liability and will be able to keep some of their belongings.
The debtor will review the state exemption list given to the debtor and learn which property to keep. This list is found in the Federal Bankruptcy Code. All the property of the debtor will be separated as exempt or non-exempt when the state trustee files a property exemption report. State exemption laws can vary from one state to another although some basic laws may be the same.
In paying off the debts, the secured debts are first to be in line. As for unsecured debts, it is possible that the creditors of unsecured debts might not get any money at all. The trustee is authorized to decide who gets the payment first, based on the law. Note that to enjoy the benefits of bankruptcy chapter 7 exemptions, the defaulter must file the case in the state where he/she resides for a period of 730 days before he/she can file for this type of bankruptcy. Alternatively, the defaulter may also file the case in a state where he/she has previously lived for more than 180 days, up to 2 years.
There are some Federal exemptions and they can include retirement benefits, death disability benefits, survivor's benefits and miscellaneous. Although, keep in mind that these may not be available in all states.
This is most probably the worst form of bankruptcy, your credit score may take a major hit because of it. You will lose most of your possessions and you need start all over again in your life. Always consider other options before you look at bankruptcy.
Unfortunately, if you are in the dired situation, then remember to educate yourself about bankruptcy chapter 7 exemptions that can help reduce your loss and maximize the benefits of this law to pay off your debts fast.
The debtor will review the state exemption list given to the debtor and learn which property to keep. This list is found in the Federal Bankruptcy Code. All the property of the debtor will be separated as exempt or non-exempt when the state trustee files a property exemption report. State exemption laws can vary from one state to another although some basic laws may be the same.
In paying off the debts, the secured debts are first to be in line. As for unsecured debts, it is possible that the creditors of unsecured debts might not get any money at all. The trustee is authorized to decide who gets the payment first, based on the law. Note that to enjoy the benefits of bankruptcy chapter 7 exemptions, the defaulter must file the case in the state where he/she resides for a period of 730 days before he/she can file for this type of bankruptcy. Alternatively, the defaulter may also file the case in a state where he/she has previously lived for more than 180 days, up to 2 years.
There are some Federal exemptions and they can include retirement benefits, death disability benefits, survivor's benefits and miscellaneous. Although, keep in mind that these may not be available in all states.
This is most probably the worst form of bankruptcy, your credit score may take a major hit because of it. You will lose most of your possessions and you need start all over again in your life. Always consider other options before you look at bankruptcy.
Unfortunately, if you are in the dired situation, then remember to educate yourself about bankruptcy chapter 7 exemptions that can help reduce your loss and maximize the benefits of this law to pay off your debts fast.
About the Author:
Want to declare bankruptcy? Thinking of declaring under Chapter 7? If so, be sure to understand more about chapter 7 exemptions. You will be surprised how many assets you can keep during the bankruptcy process! Visit our website for more information today!
posted by Debt Consolidation Loan at
6:06 AM
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