You may be worried that you will lose all your property after filing for bankruptcy. While your fears may be well-founded, it may not be the case. Filing for bankruptcy does not mean giving up every property you own. If anything, it is supposed to help you start afresh and get your finances in order.
Like most other states, Oregon has exemption laws that protect some of your assets. It means that such property is safe from creditors, and even if you have declared bankruptcy, you will still get to keep the exempted items. Some of the properties covered include:
- Up to $1,800 in personal items such as jewelry or clothing
- A homestead exemption of up to $40,0000
- A $400 exemption on any property you own
- Motor Vehicle valued at $3,000, among others
While this list is not exhaustive, some of the exemptions are doubled for married couples who file for Chapter 7 bankruptcy since each of them is entitled to the exemptions.
How exemptions work
Exemptions protect your property from being sold to repay your debts. For instance, with Oregon’s motor vehicle exemption of $3000, it means that if your vehicle is worth less than the exemption amount, then you can get to keep it. For most people, that’s not a problem, since the vast majority of people owe as much or more on their car notes as their vehicles are worth. However, if your car is worth more than the value exempted, your trustee could sell it, refund you the exempted amount, and use the rest to pay your creditors.
What else do you need to know?
If you are thinking of filing for bankruptcy, it is important to be well prepared with all the information that you will need. Understanding your options and your state’s exemption laws will help you plan better and ascertain your financial position after declaring bankruptcy. That way, you will have the upper hand when it comes to preparing for life ahead and, hopefully, bouncing back from debt.