Bankruptcy laws allow an individual to keep some of his personal property including clothes, cars, tools of the trade, and your bank account. If your properties are exempt, the trustee in bankruptcy will not be liquidating such property to pay off your creditors. Most exemptions will protect your property but only up to a limited amount. Meaning, if you have an expensive car outside the scope exempted by law, such a car will not be exempt. However, if your car is inexpensive and with the scope of the law, then your car may be granted a bankruptcy exemption.
The impact of a bankruptcy exemption filing in Oregon will depend on the types of bankruptcy you filed. For Chapter 7, the filing for bankruptcy exemption will determine what property are you going to keep. For Chapter 13, the exemption helps keep the payment plan have low monthly payments.
Common Bankruptcy Exemptions
The following are the most used bankruptcy exemptions in Oregon:
- Homestead Exemption including manufactured and floating homes of up to $40,000 for singles and $50,000 for married couples.
- Motor Vehicle Exemption with equity up to $3,000.
- Wildcard Exemption of any personal property up to $400.
- Personal Property such as:
o Household items
o Personal items
o Musical instruments
o Domestic animals
o Building materials
- Wages that are withheld for a state employee amounting up to $7,500 and a court order amount of disposable wages up to 75%
- Public Benefits including:
o Aid to the blind
o Workers’ compensation
o Assistance to medical bills
o Disaster relief
o General assistance
o Unemployment compensation
o Federal income tax credit
- Tools of Trade
- Child support and Alimony
Federal Bankruptcy Exemptions vs Oregon Exemptions
In Oregon, citizens are allowed to choose between federal bankruptcy exemptions or state exemptions. Residents are only allowed to choose one and cannot avail of the exemptions from both. The two have different lists of properties that you can exempt and you must check to see what list works best for you. Talk to a reliable bankruptcy attorney in Portland for more information.
What are the Effects of Filing Bankruptcy Exemptions for Chapter 7 Bankruptcy?
In Chapter 7 bankruptcies, trustees are appointed to liquidate or sell your properties and the proceeds will be used to pay your lenders. However, not all your properties are forfeited in this chapter so that you can have a fresh start such as buying a house after bankruptcy.
After completing the paperwork and passing the means test, you are now qualified for Chapter 7. You can now proceed in listing your properties and the exemptions you want to claim for them. If the property is fully covered by the exemption, you can keep such property. If not, the bankruptcy trustee will take charge and sell the properties to pay back the creditors. If the property is partially covered by the exemption or if it is a secured debt under a mortgage payment or collateral, it is the creditors’ rights to be paid first.
What are the Effects of Filing for Bankruptcy Exemptions for Chapter 13 Bankruptcy?
This option is a repayment chapter where the Chapter 13 trustee will not acquire the properties of the debtor. When your petition for exemptions is approved, you are still afforded bankruptcy protection from harassing creditors and other collection agencies. You will only need to repay the value of the nonexempt properties such as credit card debt. Your debt-repayment plan will be lower, allowing you to pay all your creditors and obtain debt relief.
How to File Bankruptcy Exemption in Portland?
If you are overwhelmed with debt and is considering bankruptcy, the bankruptcy code does not require you to have a bankruptcy lawyer but having the help of a bankruptcy attorney is greatly beneficial because the bankruptcy law can be very complex and small mistakes can lead to your petition for bankruptcy to be denied, wasting all the time, money, and effort you made. Here at Northwest Debt Relief Law Firm, we will help and guide you through our experienced Portland bankruptcy attorneys in all the bankruptcy matters not just before the bankruptcy filing, but also with the after services such as how to rebuild credit, bankruptcy pros and cons, and any other bankruptcy services you need to be out of debt. Call us now for a free legal consultation.