One of the most common myths about filing for bankruptcy is that you will lose all of your possessions in an effort to repay creditors. That simply is not true. In a Chapter 7 bankruptcy filing a California resident will list all assets so that they can be reviewed for liquidation. However, what many of our Escondido readers may not know is that there are quite a few assets that fall within designated bankruptcy exemptions.
For example, under one set of exemptions a person's home would be exempt up to a certain dollar amount. Motor vehicles and home furnishings can also be exempt, as can some amounts of jewelry and items used in the course of a person's profession. All bankruptcy exemptions are subject to maximum values that cannot be exceeded.
With the wide range of exemptions that can apply in a bankruptcy filing, it is important for filers to review their assets and make sure they are picking the exemptions that make the most sense for their unique situation. An asset protection review should be part of any potential bankruptcy filing.
When an Escondido resident is contemplating a move to file for bankruptcy, there are many different pros and cons that must be evaluated. For some people, filing for bankruptcy can be the best financial move they can make at the time to get their finances back on track. For others, there may be different options that should be considered. Everyone's situations are different, and no two bankruptcy filings are alike.
Source: www.publiccounsel.org, "Commonly Used California Exemptions," Accessed June 27, 2015