There are many factors that contribute to a decision to declare bankruptcy. Some people can’t control their overwhelming credit card debts. Others can’t afford to pay off their medical bills on time. These and other problems often leave people with few alternatives but to declare bankruptcy.
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State property exemption laws are important to know about because they can often protect personal property from their creditors. There exist certain exemption laws that can be of great help to Michigan and Pennsylvania residents who must declare bankruptcy.
The most important Michigan exemption laws help people protect several important financial assets. Michigan residents can also use these laws to protect insurance benefits, and public benefits such as food stamps or SSI payments.
Certain types of property can also be protected in Michigan. For example, residents may exempt up to $1,000 worth of tools that are used in for work.
In Michigan, an individual filing for bankruptcy may exempt as much as $3,500 of their home equity, and this doubles for spouses. In other words, married spouses who are filing for bankruptcy together can exempt up to $7,000 of the equity in their home. If you need help understanding this exemption more clearly, ask the local bankruptcy lawyers in your area for more details.
In Pennsylvania, residents are entitled to exemptions on their retirement savings and certain other financial assets. Most household items and any public assistance benefits are typically exempted.
The exemptions also allow residents to protect up $9,300 worth of household goods, $8,725 per person in the equity in a home, and up to $9,300 towards the cash surrender value of most life insurance policies. These exemptions allow people to protect most of their personal belongings from their creditors. Pennsylvania also allows a so-called “wildcard” exemption that allows them to designate up to $9,325 of their property as being exempt. There also exists an automobile exemption that can protect up to $2,775 of the value of a vehicle.
As you can see, Michigan and Pennsylvania residents may combine their state exemptions in some instances to protect more of their property. Since these exemptions can vary where you live, ask your local bankruptcy lawyers today for more details on how to combine your state’s bankruptcy personal exemption laws to your advantage.