California Bankruptcy exemptions are designed to protect your property from being sold by the bankruptcy trustee when filing for bankruptcy protection. Since California doesn't allow debtors to utilize Federal bankruptcy exemptions, those filing for debt relief under the US Bankruptcy Code must decide between one of two sets of exemptions. These exemptions, commonly referred to as the "703" or "704" California bankruptcy exemptions are different and while both have their pros and cons, this article will focus on the advantage of the California Bankruptcy 704 exemptions and who might gain more from utilizing them.
Perhaps the best reason to file 704 exemptions vs. 703 exemptions when filing for bankruptcy is because you can protect a large amount of home equity in your residence. The homestead exemption found in the 704 set covers at least 3 times as much for home equity when compared to 703. While the 703 set of exemptions cover only about $28,000 in home equity, the 704 exemptions can cover anywhere from $75,000 up to $175,000 worth of equity, based on your situation.
Personal Property Exemptions
Another situation where utilizing the 704 exemptions could be beneficial is if you have an abundance of jewelry, heirlooms, and art that you desire to protect from being sold to fund your bankruptcy payouts to creditors. Under 703 exemptions an individual can exempt up to about $1,800 in jewelry, whereas, under the 704 bankruptcy exemptions you can save up to about $8,000 worth of jewelry, heirlooms, and art.
Additionally, where wages are concerned 704 exemptions have a tremendous advantage over the 703 exemptions. Under the 704 exemptions, a consumer can exempt up to 75% of all wages paid within 30 days of filing for bankruptcy.
Which Bankruptcy Exemption Are Right for Me?
Only a California bankruptcy attorney is qualified (and legally allowed) to offer you legal advice on bankruptcy. The aforementioned California 704 exemptions are only a few that are listed under each system and therefore you should ensure that you are well acquainted with each set of California bankruptcy exemptions in their entirety before deciding. Moreover, rates of bankruptcy discharge are higher for individuals that are represented by a bankruptcy attorney in Sacramento California, as legal advice will help ensure that you follow each step in the process precisely and that you protect as much property as is allowed by the US Bankruptcy Code.