Mooney & Stewart, P.A., Tampa Bankruptcy attorneys & lawyers In Bradenton, Sarasota, St. Petersburg Florida

Basically chapter 7 is the termination of a business operation of the debtor’s such assets which are nonexempt. The bankruptcy regent (members of a governing board) owns the property of the debtor and terminates such assets of the debtor’s which are not secure. In this process the assets of the debtor sold and return (the income or profit arising from such transactions as the sale of land or other property) is used to pay creditors.

In chapter 7 bankruptcy code, bankruptcy allows the debtor to hold back certain basic assets, which are known as exempt property. Following are some examples of such property that may be exempt in a bankruptcy in Florida.

Homestead. Under the article X Section no.4 of the Florida Constitution your homestead (the home and adjacent grounds occupied by a family) is exempt property. This security protection is afforded homestead properties situated on one-half acre or less within a municipality and properties up to 160 acres outside a municipality (an urban district having corporate status and powers of self-government). There is no restriction on dollar. The homestead exemption applies to all residents who live in Florida. There is no affect of new bankruptcy law on homestead protection for Florida residents in state court proceedings. But this new law of bankruptcy does modify the homestead exemption for Florida residents who file bankruptcy.

This new Law provides security to unlimited equity in your homestead when you purchased the residence 40 months or more prior to filing bankruptcy. Under this new Law if you buy your home within 40 months the new law exempts up to $137,000 of equity (the difference between the market value of a property and the claims held against it). The amount of exemption accelerate (effective April, 2007) from the original $125,000 to approximately $137,000 each person. More ever, if you apply cash in your home between the 40 months, like by paying down the mortgage (put up as security or collateral) or building a home addition, the amount of investment made within the 40 months will not be exempt even if you purchased the home 40 months prior to filing (the entering of a legal document into the public record). The homestead exemption limit of $137,000 applies only in case of bankruptcy. Many courts have held that a married couple filing jointly can claim two homestead exemptions for a total homestead protection of $274,000.

The chapters 222 of Statutory Exemptions for the Florida Statutes consist of many categories of exempt property, including: pensions, 401K plans, tax deferred retirement plans such as, Social Security income, disability income, IRAs, annuities, cash value of life insurance, college investment plans (which including 529 Plans), health savings accounts, and savings accounts of hurricane.

Automobile Exemption: In automobile exemption in an automobile you are allowed to exempt up to $1,000 of equity. For example if someone who jointly own a car may exempt $2,000 of value in that car. Most bankruptcy trustees (legal term for a holder of property on behalf of a beneficiary) accept the average retail/wholesale value from the yellow NADA book, adjusted for the condition of your car. In case the balance of your car loan is greater than the car value, then it means that you don’t have car equity and hence your car is safe in bankruptcy as long as you keep your car payments current.

Miscellaneous personal property exemption: Every debtor of bankruptcy can grant relief up to $1,000 ($2,000 for joint filings) for all other personal property which includes the following things like furniture, cloths, tools, and estimated cash on hand etc. For the purpose of bankruptcy the value of your personal property is same to its current fair market value in a public market, like a garage sale or flea market sale. Such debtors who do not claim a homestead exemption, for such debtors a new Florida statute effective July 1, 2007, provides up to $4,000 "wildcard"(basically Wildcard is a self-released EP by Pennywise) personal property exemption to bankruptcy.

When you contact with such a person to whom legal title to property is entrusted to use for another's benefit (trustee) after you file bankruptcy. The trustee has 30 days following your meeting in which he can object to your exemptions. If you claim an asset as exempt on your petition of bankruptcy, and in the next 30 days there is no objection, then you can consider that asset grant relief and now you can do anything you like with your assets. Non-Exempt Property: Non-exempt property is such a property which has no grant relief under the law of Florida which is involved in the bankruptcy estate.

In the chapter no. 7 Trustee can may take and sell out all such property which is non-exempt and then distribute the return to such creditors who are not firmly fastened or secured.(there is opportunity for you that you can keep your non-exempt property by entering that into a "buyback" agreement with the Trustee. By executing a buy-back agreement along with the Trustee, you have two options; you can either make a complete payment consisting of a single sum of money to the Trustee or make monthly installment payments, that is consist of a period of several months).

If you want more information regarding Chapter 7 bankruptcy and want to know how it can be beneficial to you, then you can contact our firm today in order to talk with a skilled and dedicated attorney.