If you have been losing an endless battle with debt, it may be time to consider filing for bankruptcy. While most people are hesitant to take this step because they think that they will lose everything in the process, it is important to understand that state and federal laws will protect some of your most valuable assets—including your home, car, personal belongings and insurance benefits. In order to determine just how much equity will be exempt from your bankruptcy petition, however, you will need to decide whether you would like to claim state or federal bankruptcy exemptions. Depending on the type of property that you would like to protect, each will have their advantages.
For example, federal exemptions will allow you to protect a maximum of $22,975 in homestead equity, while Michigan's bankruptcy exemptions would allow you to protect a maximum of $35,000. On the flip side, claiming federal exemptions would allow you to keep $12,250 worth of personal belongings—including household goods, furnishings, appliances, clothes, etc.—while the state exemptions would only allow you to protect $3,525. For this reason, you will need to determine which exemption system you would like to claim before filing your petition with the court. With the help of a Michigan bankruptcy attorney from Hensel Law Office, PLLC, you can weigh the advantages that each system has to offer.
To gain a general understanding of how the state and federal bankruptcy exemptions will differ, take a look at the following information:
-
Homestead Exemptions
- Federal Exemptions: $22,975.00
- Michigan Exemptions: $35,000.00
-
Motor Vehicle Exemptions
- Federal Exemptions: $3,675.00
- Michigan Exemptions: $3,250.00
-
Personal Property Exemptions
- Federal Exemptions: $12,250.00
- Michigan Exemptions: $3,525.00
-
Retirement Account Exemptions
- Federal Exemptions: $1,245,475.00
- Michigan Exemptions: $1,095,000,000.00
If you are interested in discussing your options with a Michigan bankruptcy lawyer, we encourage you to contact the legal team at Hensel Law Office, PLLC today. We understand that the process of filing for bankruptcy can be overwhelming, so we would like to ensure that you are adequately protected—while still helping you to free yourself from unmanageable debt. In order to find out how our firm can help, give us a call today at (888) 258-0651 for a free consultation. From there, you will have the opportunity to schedule an appointment with our experienced bankruptcy lawyer. Even if you are only available to meet on the weekend or in the evening, we can accommodate your needs.
If you are looking for further information about the process of filing for bankruptcy, you should not hesitate to visit our helpful FAQ page.