Nonexempt property bankruptcy is important to know about because it can have a significant impact on your financial future. If you file for bankruptcy and have nonexempt property, it could be sold by the bankruptcy trustee to pay off your creditors. This could mean losing your home, car, or other valuable assets.
Even if you don’t have any nonexempt property, it’s still important to understand what it is and how it works so you can make more informed decisions about your bankruptcy and protect your assets as much as possible.
How is Nonexempt Property Treated in Chapter 7 Bankruptcy in Mississippi?
In Chapter 7 bankruptcy in Mississippi, the bankruptcy trustee sells nonexempt property and distributes the proceeds to creditors. The trustee will typically start by selling your most valuable assets, such as your home and car. If you have any other nonexempt property, such as jewelry, electronics, or furniture, the trustee may also sell those items.
The trustee will not sell all of your nonexempt property, however, certain exemptions allow you to keep some of your property, even if it is not exempt. For example, you are typically allowed to keep your homestead (up to 160 acres), personal belongings (such as clothing and furniture), and certain tools and equipment necessary for your job.
If you have nonexempt property that you want to keep, you may be able to redeem it by paying the trustee its fair market value. You may also be able to exempt some of your nonexempt property by using a wild card exemption. Wild card exemptions allow you to exempt up to $12,500 in equity from any property, including nonexempt property.
How is Nonexempt Property Treated in Chapter 13 Bankruptcy in Mississippi?
In Chapter 13 bankruptcy in Mississippi, nonexempt property is not automatically sold to pay off creditors. Instead, the debtor must include all of their property, both exempt and nonexempt, in their Chapter 13 plan. The debtor must then propose to pay back their creditors a certain amount of money over a period of 3 to 5 years. The amount of money that the debtor must pay back will depend on their income and expenses, as well as the value of their assets.
If the debtor has nonexempt property, they may be able to keep it by paying the value of the nonexempt property to their creditors throughout their Chapter 13 plan. This is known as redemption. The debtor may also be able to exempt some of their nonexempt property by using a wild card exemption. Wild card exemptions allow the debtor to exempt up to $12,500 in equity from any property, including nonexempt property.
If the debtor cannot afford to redeem their nonexempt property or exempt it using a wild card exemption, the bankruptcy trustee may sell the nonexempt property to pay off creditors. However, the trustee will not sell all of the debtor’s nonexempt property.
When Can I Use Bankruptcy Exemptions in Ridgeland, Mississippi?
To use Mississippi bankruptcy exemptions, you must have lived in the state for at least 730 days before filing for bankruptcy. If you have lived in Mississippi for less than 730 days, you will need to use the exemptions of the state where you lived for the majority of the 180 days before the two-year period that immediately preceded your filing.
What Are the Mississippi Bankruptcy Exemptions?
Mississippi bankruptcy exemptions include:
- Homestead exemption: Up to $75,000 of equity in your primary residence.
- Personal property exemption: Up to $10,000 of personal property, including clothing, furniture, and vehicles.
- Wildcard exemption: Up to $50,000 of any property, including equity in your home or other assets.
- Vehicle exemption: Up to $20,000 of equity in one vehicle.
- Retirement account exemption: Most retirement accounts are exempt from bankruptcy, including 401(k)s, IRAs, and Keogh plans.
How to Claim Mississippi Bankruptcy Exemptions?
When you file for bankruptcy, you will need to file a schedule of your assets and liabilities. This schedule will list all of your property and debt. You will also need to file a statement of exemptions, which will list the property that you want to exempt from bankruptcy.
If you are unsure about which exemptions you can claim, it is important to speak with a bankruptcy attorney. An attorney can help you understand the exemption laws and ensure that you are protecting your assets to the fullest extent possible.
File Bankruptcy in Ridgeland, Mississippi Today!
When filing for bankruptcy, understanding the complexities is imperative to make sound decisions. However, this is not easy for the average individual. Bankruptcy is one of the most confusing areas of the law. To avoid mistakes and achieve your financial goals, it is important to speak with an experienced bankruptcy attorney!
At Rollins Law Firm, we aim to understand your situation with genuine empathy. We will exert our utmost efforts to help you achieve a fresh start. Don’t feel hopeless about your current financial situation. Everything is possible with our compassionate bankruptcy attorneys in Ridgeland, Mississippi.