What Types of Property Can’t Legally be Reclaimed?
Bankruptcy can be defined as financial death. Suppose you intend to file bankruptcy, there are two options for you: file under chapter 7 or chapter 13 bankruptcy. Dealing with a bankruptcy situation in the first instance without legal help can be challenging thus reaching out to a Brooklyn Bankruptcy Lawyer can help you understand the two types of bankruptcy and in particular the best-suited option for you.
The type of bankruptcy you choose to file will determine whether you get to keep your property or not. Here is what you need to know about the two types of bankruptcies as explained by our Brooklyn Bankruptcy Attorney:
Chapter 13 Bankruptcy
As someone facing a financial crisis, your biggest hope is that you get to keep your property. Well, chapter 13 bankruptcy is the savior you need because this type of bankruptcy allows the adjudged bankrupt to keep both exempt and non-exempt properties. However, you will keep your property on a condition that the existing debts are paid following your payment plan. Chapter 13 allows you to develop a plan of between three and five years and subsequently make payments on the plan monthly.
Chapter 7 Bankruptcy
Anyone filing Chapter 7 bankruptcy is under an obligation to surrender the non-exempt property, and they don’t have to pay back the debts. After surrendering the non-exempt property, the bankruptcy trustee takes up the role of sale and distribution of proceeds to your creditors. Subsequently, you are under an obligation to attend various creditor meetings and also inform the court how you intend to discharge secure debts.
What property is considered non-exempt?
There is usually a requirement that you choose a bankruptcy exemption system. There are two types of systems; federal bankruptcy exemptions and state bankruptcy exemptions. With the help of a competent bankruptcy lawyer in Brooklyn, you can establish the correct system and what property you get to keep under chapter 7. Where a state allows freedom to choose between either system, your bankruptcy lawyer in Brooklyn can take you through the pros and cons of each because it is impossible to choose both systems. So far, Michigan allows Federal bankruptcy exemptions therefore if you are a Brooklyn Michigan resident you can choose either of the systems following advice accorded by your Brooklyn Bankruptcy Lawyer.
Here are some of the properties you get to keep:
Your home forms part of the properties that are protected by exemptions. However, some conditions have to be met for the home to qualify for an exemption. Our Brooklyn Bankruptcy Lawyer is well aware of the various factors that have to be present for your primary residence to qualify for an exemption.
Most states have an exemption for a car for equity amounting to 5000 dollars. Our Ursulova Law Offices can help explain how exemptions work. When filing chapter 7 bankruptcy where your car is worth more than the provided equity, the bankruptcy trustee will have to sell the car, give you 5000 dollars and give the balance to your creditors. Chapter 13 bankruptcy, on the other hand, deals with exempted property differently. Since you already have equity of up to 5000 dollars, the remaining 10000 dollars can be paid to your creditors through a payment plan.
In Michigan, personal property qualifies for an exemption up to a specific amount of money. Knowing the exact figures of the equity provided by an exemption can be hard, Our Brooklyn Bankruptcy Attorney Ursulova Law Offices, our attorneys, are always ready with the right figures applicable in your situation.
Filing bankruptcy can only help cure certain debts and not all. Therefore suppose you intend to file bankruptcy, our Brooklyn Bankruptcy Attorney can help you realize what debts can be cured by bankruptcy and those that can’t.