What Property Can I Keep?
Hawaii Bankruptcy Lawyer Explains Exemptions
The stereotypical perception of bankruptcy is that a person or family will lose absolutely everything they own to creditors and banks. However, this perception is far from the truth. Under the Bankruptcy Code, Hawaii residents can keep a certain amount of property by exempting it from their creditors. The exact circumstances vary from case to case, and our Hawaii bankruptcy attorney can help explain how this may affect your own situation.
The Founding Fathers specifically wrote the Constitution with a clause about bankruptcy because they sought to end the scourge of debtor’s prisons in our young nation. Far from being a punishment, a bankruptcy is a solution that allows you to resolve your debts while still keeping the property you need to survive.
State vs. Federal Exemptions
The State of Hawaii allows individuals filing for bankruptcy to claim exemptions under either the state or federal guidelines. Although the specifics will vary depending on the circumstances, generally the federal exemptions are more favorable to our clients. Our experienced lawyer can guide you through the best path that will allow you to maximize the property you can keep.
Generally, Hawaii bankruptcy filers can keep:
- The equity in a home for $22,975 per person (double for married couples)
- Motor vehicles, up to $3,675 (double for married couples)
- A reasonable amount of clothing (most debtors keep all clothing)
- A reasonable amount of household goods and furnishings (most debtors keep all household goods and furnishings)
- Household appliances and jewelry, up to a certain amount (most debtors keep all appliances and jewelry)
- Retirement funds and pensions
- Tools of the debtor’s trade or profession, up to a certain value
- A portion of earned wages not yet paid
- Public benefits, including public assistance such as welfare and Social Security
As you can see, you don’t lose everything in a bankruptcy. The federal government designed bankruptcy so that ordinary families that have fallen on hard times can work their way back into stability – no debtor’s prisons, no losing what you need to survive, no destitution.
Most Chapter 13 Filers Save Their Home and Car
Both Chapter 7 and Chapter 13 bankruptcies allow ordinary, everyday people who have gotten in over their heads with debt keep equity in their homes, vehicles and certain items of property during the bankruptcy process. Filing under either Chapter 13 or Chapter 7 bankruptcy will stop foreclosure, stop repossession and stop wage garnishments.
However, many people who choose a Chapter 13 payment plan can save a home and car by catching up on the past amounts owed and becoming current with payments after the bankruptcy is concluded.
Confused? Scared? Let Us Help You
It’s understandable. Having an experienced Hawaii attorney on your side can help you navigate the bankruptcy process and set you on the path towards financial stability. Besides bankruptcy, our office also offers debt settlement and tax resolution services, and we will review all your possible options to decide the best path for you and your family. Blake Goodman regularly represents military personnel in bankruptcy, and he offers candid and confidential legal advice regarding security clearances.
There is no need to suffer the unknown terrors of collection calls and possible foreclosure of your home or repossession of your vehicle. Contact our law firm today by calling 808-528-4274 or fill out our online questionnaire to take the first step towards peace of mind.