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Will I lose my assets if I file bankruptcy?

Many people avoid filing bankruptcy because they are afraid they will lose everything they own: their home, their car, their household goods, and their retirement accounts.

In reality, most people who file Chapter 7 bankruptcy do not lose anything due to something known as "bankruptcy exceptions."

What is a bankruptcy exemption?

The intent of Florida's bankruptcy laws is to give you a fresh start-not leave you with nothing. As a result, you are entitled to keep certain assets due to our state's bankruptcy exemptions. "Exemptions" means the bankruptcy trustee cannot take those assets and liquidate them to pay your creditors.

What assets are exempt in Florida?

When you file Chapter 7 bankruptcy, Florida bankruptcy exemptions allow you to keep many of your personal assets, including:

  • Unlimited equity in your homestead property, as long as it is not more than half an acre in a municipality or 160 acres in the country)
  • Up to $1,000 in household belongings (or up to $4,000 if you don't use the homestead exemption)
  • Savings in 401(k) and IRA accounts up to $1,171,650
  • Pension plans
  • Health, education and hurricane savings accounts
  • A vehicle worth up $1,000
  • Up to six months of wages
  • Alimony and child support

An experienced bankruptcy attorney can let you know if you own any assets that are not protected by bankruptcy exemptions. If you would risk losing an asset by filing Chapter 7 bankruptcy, Chapter 13 bankruptcy may be an option.

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