Filing For Chapter 7 Bankruptcy In New York
Are there many people who file for bankruptcy in the New York State? If we check the statistics we can see that there were 109,572 cases of filing Bankruptcy in New York in 2005 while only 29,696 cases in 2006. The number of people who filed bankruptcy in 2005 and 2006 was greatly influenced by the new law that took effect on October 17, 2005. Called "The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005", it is considered a major reform of the U.S. bankruptcy system. Bankruptcy is nothing to be ashamed of. Even the third president of the United States, Thomas Jefferson filed several bankruptcies in his lifetime and he was almost constantly in debt. Fear, moral apprehension, shame or guilt, are several reasons for people to hesitate and finally to wait too long before filing bankruptcy, or at least before seeking advice from a bankruptcy professional about their financial situation. As you can see, personal bankruptcy is pretty common in New York so it's important for you to know the basics of how it works. We will present you a short guide regarding the New York bankruptcy laws for individuals. Like in any other American state, in New York you are allowed to file several different types of personal bankruptcy. Chapter 7 bankruptcy is the most common and it is also called a "straight bankruptcy". You can use the protection of this type a bankruptcy when you are no longer able to pay the creditors. Some of your assets will be liquidated by a trustee and the proceeds will be used to cover some debts. This type of bankruptcy will appear on your credit report for 10 years and it can affect your eligibility for new credits. If I file bankruptcy in New York, may I keep my home? You are allowed to keep your condo, house, mobile home or coop , if · it is your prime residence, · it is in the New York state, · you have no more than $50,000 equity in it. How can I calculate the amount of money in equity, in my case? If you own, for example, a house that is worth $500,000 and your mortgage now totals $400,000, you have a total of $100,000 in equity. In order to determine the value of your home you will need to pay about $400 for a recent appraisal. If you have too much equity, it would be better for you to file a Chapter 13 bankruptcy. In case you are married and you and your spouse are filing jointly, the all the amount mentioned above is double (which means $100,000 in equity for both of you). What else can I keep when filing Chapter 7 bankruptcy in New York? Under New York bankruptcy law there are a couple of strange exemptions to personal bankruptcy filings. For example, cooking utensils and tableware are exempt up to $5,000, as well as a sewing machine, church pew or even pet food (up to 60 days worth). If you file for personal bankruptcy, you should carefully check with your lawyer the complete list of exemptions in order to determine the things you may hold on to. You must also know that in New York only State Exemptions are allowed. |
