Legal Question in Bankruptcy in New York

Re: Bankruptcy for individual couple

Individuals who file for bankruptcy are permitted exemptions for certain property. The exemption limit for a vehicle is $2,400 per debtor. If a joint bankruptcy petition is filed, and the vehicle is titled in the name of both spouses, each can claim the exemption for a total of $4,800. If your car is worth $8,000, and you file for Chapter 7 bankruptcy, the trustee can sell it and use the proceeds to pay your creditors, after paying you the amount of your exemption. In the alternative, the trustee will accept a cash payment representing the difference between your exemption and the value of the vehicle.

The $2,400 is the exemption in New York. If you moved to New York within the past two years, other exemptions may apply.

You can also consider filing a Chapter 13 bankruptcy, where you keep your property. However, you will have to pay back at least some of your debt up to the value of your non-exempt assets (or more, depending on your income).

Visit my website at amdlaw.com for more information. Or contact my office directly if you would like to discuss your situation further.