How to Claim a Bankruptcy Exemption When Filing a Bankruptcy

When you are filing for a bankruptcy, you need to consider how to protect your most important properties. For example, it doesn't make sense to be free from debt if you don't have a home to live in. Just because you are trying to break free from your debt does not mean that you have to give up all of your assets. To protect your home, you need to claim a homestead exemption, but you need to know what you are doing. 

State or Federal Exemptions

There are two systems for exemptions when you are filing for bankruptcy. You have the federal system and the system of the state that you are living in. In some states, the federal system is not available because the state requires its residents to use their system. On the other hand, there are some states that you give you the option of using either the state or the federal system. If you have this choice, it should be based on which system gives you the best ability to protect your assets. 

Rules for Claiming Exemptions

Choosing between state or federal exemptions is not always as easy as simply selecting whichever system you like best. Rules exist to govern which system you use. If you have been living in a state that gives you the option of using federal exemptions, you will have to live in the state for 730 days before you can claim federal exemptions. This is known as the 730-day rule. The next rule you need to know is the 180-day rule. This rule stipulates that you have to live in a state for at least 180 days before you can file for bankruptcy according to the state's rules. Before you have lived in a state for at least 180 days, you will have to to file according to the rules from the state you previously lived in. Knowing these rules will help you to make smart choices about filing for bankruptcy so that you can protect your assets. 

If you are the breadwinner for your home, you have to make sure that you protect those that depend on you. Filing for a homestead exemption will help you to keep a roof over your family's head. Whether or not you qualify will depend on which system you use, so before you file for bankruptcy, make sure you know that you are able to protect what matters most. For more information, contact FactorLaw. 

About Me

Learning About Bankruptcy Without The Stress

If you have bills that you can't pay and your phone is ringing off the hook with debt collection calls, you may be considering bankruptcy. If this scenario sounds familiar, a bankruptcy attorney can help. You don't need more stress in your life than you already have. When you speak with an attorney, you can get the necessary paperwork filled out and the collection calls will stop. Hello, my name is Francis and I know exactly how you feel. When I found myself in serious debt and no way to pay back my creditors, I was in a panic. After talking with an attorney, my mind was at ease because I knew that this nightmare would soon be over. As you read my blog, you'll learn what to expect when filing bankruptcy. Since I know how stressful this can be, I wanted to help others who are in this situation.