There is a common misconception regarding bankruptcy that in order to receive relief under the bankruptcy code, the petitioner will have to give up all of their personal belongings, or worse, that someone will take away their home. The reality is that the bankruptcy rules provide for a number of generous exemptions which allow a typical petitioner to keep almost all of their property, including a personal residence.
In Washington State, we have a homestead exemption of up to $125,000.00. This means that someone can eliminate their debts through bankruptcy and still protect up to $125,000.00 of equity in their primary residence. Note that the homestead exemption applies only to a primary residence so equity in rental properties or second homes could still be at risk.
Pre-bankruptcy planning has great value as it will allow the petitioner to maximize their exemptions in order to reduce the risk of losing any of their property.
Please note that these web pages are for information only. They do not constitute legal advice. These pages do not constitute, nor do they create, an attorney-client relationship between the law office of Luce, Kenney & Associates, LLC, or Brittany Cline, Esq. and any receiver.
