Bankruptcy Lawyer | Learn About California Bankruptcy Exemption Law
Bankruptcy Lawyer | California has two different bankruptcy exemption schemes (Code of Civil Procedure section 703 and 704). Exemption Statutes are California Bankruptcy Laws that Protect Your Property from Your Creditors. Exemptions are laws passed by every state that allow you to protect certain types of your property from your creditors when you file bankruptcy-such as your home, car, pensions and IRAs, motor vehicles, clothing, tools, and other important property. California law provides a number of exemptions that protect your property, and I will be able to advise you on which exemptions are best for you to use on your bankruptcy petition. Which exemption system you claim typically depend on whether you have equity in your home. Code of Civil Procedure Sections 703 and 704 are different and each offers certain advantages depending upon the financial situation of the debtor. Those with substantial home equity often rely on the 704 ystem, while those with liquid assets or other valuables tend to prefer the 703 system.
California’s 704 exemption system protects a certain amount of equity in a debtor’s principal home. Under this law, you may exempt real or personal property you reside in up to $75,000 if you are single and up to $175,000 depending upon the size of your family. You also have the right to exempt certain amounts of personal property, including household items, health aids and up to $7,625 in jewelry and works of art. Additionally, you are allowed to exempt a portion of your wages as well as retirement funds and other assets.
Under California’s second bankruptcy exemption system, your right to exempt your home is limited to up to $25,575 – far less than allowed under the first system. It also includes similar exemptions to the first system, including motor vehicle and personal property exemptions. However, this system offers a caveat not provided for by the first exemption system.: a wild card exemption. This allows for up to $1,350 plus any unused portion of the burial or homestead exemptions (up to $26,925). This is an excellent option for debtors with assets other than equity in their homes, for example, cash in the bank, or vehicles that are paid for.
Choosing between the two exemption systems is only one part of California’s complex bankruptcy system. If you are thinking of filing for bankruptcy in or near Bakersfield, speak with Max Gardner, an experienced bankruptcyattorney at 661-888- 4335
Our office can assist you in determining whether bankruptcy is the right choice for you, and which chapter under the Bankruptcy Code would provide you with the most relief. To schedule a free consultation with a knowledgeable Bakersfield bankruptcy lawyer about filing a Chapter 7 bankruptcy in Kern County, please call our office today at 661-888-4335 .