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How bankruptcy exemptions help protect your assets

On Behalf of | May 9, 2024 | Bankruptcy, Debt Relief, Keeping Assets in Bankruptcy

Sometimes, unexpected circumstances could turn into tough financial situations. A sudden medical treatment, losing a job or a pile of bills could put you deep in debt without you realizing it. Going through a financial crisis, one could conclude that filing for bankruptcy would be the best option. If you are in this tough situation, your biggest concern is probably protecting your assets, particularly your house.

State laws protect assets through exemptions

Fortunately, Ohio has state laws and exemptions that could make it difficult for creditors to seize your assets. These rules help you keep specific properties as you deal with debt.

  • Homestead exemption: This allows you to keep your house. However, it only applies to your primary residence; it would not protect the other real estate properties you own as investments.
  • Personal property exemption: This could protect your motor vehicle, household goods, health aid, electronic device, jewelry and other personal property.
  • Money benefits: This protects your retirement accounts, pensions and life insurance policies. If you were divorced, it could also protect the alimony and child support you receive.

However, there are certain limitations on these exemptions. For instance, you can only protect up to $145,425 of equity in real estate property and $4,000 of equity in motor vehicles. Nonetheless, every case is different, and it needs careful analysis to ensure the best possible option for your situation.

Legal professionals lay down all available options

When you are deep in debt, the feeling of helplessness can overcome you. However, you do not have to go through this obstacle alone. Seeking the guidance of bankruptcy lawyers early on could help you strategize remedies and prevent further financial damages.

A competent bankruptcy lawyer could explain the different options available to you to address your needs. A Chapter 7 bankruptcy involves liquidating all your assets, while a Chapter 13 bankruptcy involves developing a repayment plan. By having a trusted and compassionate lawyer by your side, you can find peace of mind knowing that you can protect your hard-earned properties as you work toward resolving your financial liabilities.