Fears about the requirements to get rid of assets may be the number one reason why people put off filing for bankruptcy when it could help them. Chapter 7 bankruptcy can be an incredible tool for those whose income no longer allows them to manage their current level of debt, but it’s one that many people don’t understand.
Most people who find themselves considering Chapter 7 bankruptcy have always been hard-working, responsible adults. It takes something as small as a car crash or a sudden illness to leave you out of work and struggling to make ends meet.
While Chapter 7 bankruptcy is liquidation bankruptcy and does sometimes require that the people filing sell their property in order to repay their creditors, some of your property is exempt from that process. That includes your interest in your primary residence.
Oklahoma has generous homestead exemptions
When you file for bankruptcy, you get to exempt certain property as determined by your state laws. Oklahoma actually has relatively forgiving bankruptcy exemptions that protect homeowners. Many states cap the maximum homestead exemption at a specific amount of money, but that is not the approach in Oklahoma.
If you live in an urban area, you can exempt your primary residence and the land that it stands on provided that the lot is one acre or less. If you live in a rural area, you can, theoretically, exempt up to 160 acres of land and the improvements on that property.
However, you have to show that the property is your primary residence and not your business. The amount of exemption you qualify for will go down substantially if you use 25% or more of the property for business rather than personal use.
The right help can maximize the benefits bankruptcy offers
Knowing the exemptions that are available to you and how to maximize their protection can drastically reduce the risk you take when you file for bankruptcy.
Partnering with an attorney experienced in Chapter 7 filings in Oklahoma will not only help you by alleviating the stress that comes with managing the paperwork of a bankruptcy filing but will also give you the protection and advocacy of having someone fighting for your best outcome.