One of the biggest questions people in Rexburg and the rest of eastern Idaho have when considering filing for bankruptcy is whether or not they can keep their house, car, or other prized possessions. The answer is, sometimes.
Idaho does provide several exemptions which can help you keep property. First, it is important to understand that the exemption amount given below refers to the equity in the property, not the value of the property itself. Equity is the difference in the value of the property and how much is owed on it. For example, if you own a house worth $200,000 and owe $170,000 on it, you have $30,000 in equity. Houses and cars are generally relatively easy to determine a value for since there are web sites listing values of cars and realtors or real estate appraisers can determine the worth of your home.
It’s important to note for the value of other items of personal property, you need only determine what I call the “garage sale” or “pawn shop” value; that is, the price the property could fetch if you needed to sell it fast. The property I see this on most frequently is wedding/engagement rings. It’s not uncommon to have people in my office who have very little to their name other than maybe a car and wedding/engagement ring. People are sometimes concerned because their ring cost so much and the exemption amount is so low. However, people are often shocked to find out that that $10,000 ring they bought at the jewelry store was probably only worth $5,000 after they walked out of the store with it and may be worth well under $1,000 a couple years later.
Without further adieu, here are some of the most common exemptions in Idaho:
- Home: $100,000 (same amount for individual or joint debtors)
- Appliances, furnishings, books, clothing, pets, musical instruments, one firearm, family portraits, and sentimental heirlooms: $750 each, $7,500 total
- Jewelry: $1,000
- Vehicle: $7,000
It should be noted, this is a very simplified version of what is contained within the bankruptcy code, which spans hundreds of pages. A Chapter 7 bankruptcy petition is a complex form which requires a deep understand understanding of complicated statutes.
If you are considering bankruptcy, you should strongly consider hiring a competent Rexburg, Idaho bankruptcy attorney. Mistakes on your bankruptcy petition can lead to negative results ranging from simply delaying your bankruptcy to having valuable possessions you were entitled to keep sold so creditors can be paid to not having all your debt discharged and still not having the fresh start you were hoping for.
Don’t try and handle a Chapter 7 bankruptcy yourself until you’ve at least had a free consultation. Call today and starting getting the relief you need.