Pennsylvania residents who are seeking to file chapter 7 bankruptcy to help eliminate some of their outstanding debts have many concerns. One of their top concerns is often their property and home. They do not want to risk losing everything that they have due to financial hardship, and a home often holds more meaning than any other asset. There is a way that you can protect equity when filing for chapter 7 bankruptcy; this is known as the “homestead exemption.”
The laws that outline rules and the amount of equity that is protected are governed by the individual states. Some states have an unlimited amount of equity that can be protected under this exemption, others protect no equity at all. Unfortunately, Pennsylvania falls under the latter.
What can you do if there is no homestead exemption in your state?
Though some states do not have a homestead exemption to protect your property when you are forced to file for chapter 7 bankruptcy due to unfortunate financial circumstances, these states often do have what is known as a “wildcard exemption.” This legislation can be applied to any property that is owned by the individual that is filing for bankruptcy, though some states prevent the exemption from protecting homes.
It is important to know the laws and exemptions in your state so that you may be protected in the event that you need to file for bankruptcy. If you have additional questions or concerns, speaking with an experienced attorney could be beneficial and help you better understand your rights.