Bankruptcy exemptions are an important factor in both Chapter 7 and Chapter 13 bankruptcies in California. Bankruptcy exemptions include assets or property that you are allowed to keep after a bankruptcy. In Chapter 7 bankruptcies, exemptions are in place to determine property that you get to retain after your bankruptcy has been discharged, and is a helpful way to protect your property after a bankruptcy. Alternatively, in a Chapter 13 bankruptcy, California bankruptcy exemptions help in determining the amount of money you will have to pay to unsecured creditors.
California Bankruptcy Exemptions
Because Federal bankruptcy laws allow each state to create its own exemptions, they can differ drastically from state to state. Furthermore, some states can allow a debtor to choose between Federal exemptions or state exemptions, or the state may force the debtor to claim only state exemptions. With this in mind, it’s important to be aware of the state laws in which you plan to file bankruptcy. This is also why it’s so important to enlist the aid of a bankruptcy attorney that is familiar with the law where you live.
For those who live in California, the bankruptcy laws dictate that you must use the California exemptions; you cannot use federal exemptions. There are, however, two different sets of California Bankruptcy Exemptions to choose from which are commonly referred to as C.C.P. (California Code of Procedure) 703 and 704. These two different sets exemptions differ greatly in the dollar amount you can exempt for your home, automobile, personal property, and financial accounts. A bankruptcy attorney can take a look at your current personal situation and properly advise on which set of exemptions makes the most sense for you.
By using a California bankruptcy attorney you will be able to maximize your exemptions, in addition to having a much greater chance of success in getting a bankruptcy discharge of your debts. This is fact, as the statistic show a much higher rate of discharge for bankruptcy cases represented by an established bankruptcy attorney in Sacramento compared to those cases that are filled by an individual without one.