Harwood Heights Bankruptcy Lawyer

Harwood Heights bankruptcy lawyer explains what assets can be kept while filing a bankruptcy? You can keep several assets in a Chapter 7 bankruptcy while still eliminating your debt. Specifically, you can keep a house and/or vehicle provided you don’t have significant equity in those items. In the state of Illinois you are allowed to protect up to $15,000.00 worth of equity in a piece of real estate. If the case is a joint case, husband and wife, the two parties can protect up to $30,000.00 equity combined. This amount that can be protected is known as the exemption amount. Real estate covers exemptions of up to $15,000.00 per person for an individual bankruptcy or joint bankruptcy. For autos, individuals can exempt up to $2,400.00 worth of equity in one motor vehicle. If the case is a joint case, then the couple can combine their $2,400.00 exemption and protect up to $4,800.00 worth of equity in one vehicle.

In the state of Illinois, each individual is also granted a $4,000.00 wild card exemption which can be sprinkled over any type of personal property. Thus in a joint case there’s $8,000.00 worth of miscellaneous wild card exemption that could be sprinkled over a vehicle, bank accounts, or any other type of personal property. ERISA qualified retirement accounts are 100 percent protected when filing a Chapter 7 bankruptcy. You can also protect all of your necessary clothing. You can also protect up to $7,500.00 in an injury claim. So there is protection for you when you file Chapter 7 bankruptcy. Most people are able to keep their house and car while filing Chapter 7 and eliminating unsecured debt. Unsecured debt includes medical bills, credit card bills, personal loans, utility bills, auto repossession deficiencies, and mortgage foreclosure deficiencies. Unsecured debt also can mean debt for just about any other type of service.

Secured debt is debt that is secured by property such as a house, a vehicle, jewelry, furniture, electronics which has not yet been paid for yet. The debtor has the ability to reaffirm the debt on a vehicle by agreeing to go back on the hook for the amount owed on that vehicle by signing a reaffirmation agreement. This is also an opportunity for a debtor to give back a vehicle and not be obligated for any future payments. With regard to real estate, I do not recommend reaffirming on real estate. The Bankruptcy Code provides that reaffirmations are mandated for vehicles. For more bankruptcy advice, contact a local attorney for help.

Posted in Illinois Bankruptcy |