California Bankruptcy Exemptions 704 – How to Keep Your Assets in Bankruptcy?
One of the main concerns you may have when considering bankruptcy is whether you can keep your home, car and other personal property. What you can keep in bankruptcy depends on the available bankruptcy exemptions in your state. When you file for bankruptcy, creditors cannot touch assets that the bankruptcy exemptions protect. In California you can select from either 703 bankruptcy exemptions or 704 bankruptcy exemptions, but not both. The bankruptcy exemptions outline what items are protected from creditors liquidating in a bankruptcy. The practice is generally to use 704 bankruptcy exemptions if there is substantial equity in the home, but which exemption to select depends on the amount of equity and what additional assets you own.
Under the 704 California bankruptcy exemptions you can protect the following assets and equity:
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Motor Vehicle-You can protect up to ,725 in the value of motor vehicles. Below are some examples of how this exemptions works:
- If your vehicle is worth ,000 and you owe ,000 then there is ,000 in equity in the vehicle. Under the bankruptcy exemptions you could protect the equity in the vehicle.
- If you own two vehicles that are fully paid for and vehicle #1 is worth 00 and vehicle #2 is worth 00, then the total equity in the vehicles is 00. Under the bankruptcy exemptions you can protect the equity in both vehicles since the total is not above the allowed motor vehicle exemption of ,725
- Household furnishings, appliances and clothing-Your household furniture, and clothing are protected if they are ordinary and reasonably necessary by you and your family. There is no specific amount for this exemption. You can protect all household furnishing, appliances and clothing as long at they are ordinary and reasonably necessary by you and your family.
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