There are several different types of bankruptcy, and they each impose different requirements on filers. Chapter 7 bankruptcy is one of the more popular options.
Chapter 7 bankruptcy is a relatively rapid form of bankruptcy that people can complete within a few months if they qualify. Some people call Chapter 7 bankruptcy liquidation bankruptcy. This name comes from the requirement to report assets to the courts and to potentially sell off or liquidate resources to repay creditors before receiving a discharge.
Thankfully, there are exemptions available to protect personal property during bankruptcy. What do those filing in Florida need to know about bankruptcy exemptions?
Florida has unique bankruptcy statutes
There are federal bankruptcy exemptions, and there are also state-level exemptions that differ from one jurisdiction to the next. Those filing for bankruptcy in Florida need to be aware of two relatively strict rules regarding those exemptions.
The first rule relates to when people are eligible for bankruptcy in Florida. Typically, people must have maintained residency in Florida for at least 730 days or two years to be eligible to file for bankruptcy in Florida.
The second rule has to do with the selection of exemptions. In some states, filers can choose between federal and state exceptions. Those seeking bankruptcy relief in Florida only have the option of using State exemptions. Florida offers exemptions for primary residences, motor vehicle equity, personal property, educational/health savings and retirement savings. There is also a wildcard exemption.
Reviewing personal circumstances and resources with a bankruptcy attorney can help people determine if a Florida Chapter 7 bankruptcy is their best option. Filers who have appropriate support can often preserve their assets without the need to liquidate property to receive a discharge in a Chapter 7 case.
