Although federal bankruptcy law mainly regulates bankruptcies, the individual states can have specific guidelines for the process within their jurisdiction. States can typically choose to have their own rules that govern the types of exemptions that the debtor is allowed to keep after filing for a discharge of their debts.

For instance, some states will allow debtors to keep their homes no matter how expensive or extravagant they are whereas other states will force the liquidation of property as an attempt to pay off the debts. Other variations include the types of debt that a debtor can discharge, although many of these are federally mandated without exception.

Florida bankruptcy law heavily favors debtors in regards to the property that they can retain. In fact, Florida has a reputation for being one of the most liberal states in the country for debtors to petition for a discharge of debts. The state government has elected to opt out of the federal regulations concerning the debtor’s lawfully retainable property.

According to Florida bankruptcy proceedings, you can keep more of your personal property during a bankruptcy than in any other state. As a result, many people who plan to file often move to Florida with their assets in order to take advantage of the state’s lenient bankruptcy law.

To see a contrast in the how the bankruptcy law changes from state to state, look at the exemptions that the Maryland law allows. Maryland is stricter in regard to the debtor’s assets that must be liquidated in a bankruptcy.

For instance, a debtor who files bankruptcy in Maryland is only entitled to keep $500 worth of household goods and furnishings as well as $3,000 of cash in their bank accounts. Also according to Maryland bankruptcy law, debtors can only retain up to $2,500 worth of personal property and the rest must be sold or liquidated so the proceeds can go towards paying the creditors.

Different states have varying guidelines regarding bankruptcy law, but each category has specific regulations, too. In a Chapter 7 bankruptcy, for instance, you can have many of your debts completely discharged so you can get a fresh financial start.

On the other hand, Chapter 13 bankruptcy requires you to enter into a repayment agreement that the courts will oversee and make provisions to help you pay off your creditors in a timely manner. Rules also vary as to how much of your property you are allowed to retain when going through a bankruptcy.

Although federally regulated, bankruptcy law hinges on the guidelines of the individual states and the bankruptcy chapter that the debtor chooses to file. While some states have lenient laws that favor the debtor’s situation, the bankruptcy laws in other states tend to favor the creditor.

Until the recent amendments to the federal bankruptcy code, the federal guidelines favored the debtor, but those times have changed and now it is much more difficult for a debtor to completely discharge their debts. As a result, many people either try to find solutions through loopholes in the system or they deal with the ramifications that filing for bankruptcy will have on their financial future.

bankruptcy

I’mJoseph McDaniel and I am a Board Certified Arizona Bankruptcy Attorney. My firm is a debt relief agency and I help both people and businesses file bankruptcies. If you’re interested in filing a bankruptcy in Arizona or have questions, please call our firm at 602-297-3025 or visit my website at www.josephmcdaniel.com and my free Bankruptcy blog at www.arizonabankruptcyblog.info Well, no. Yeah. Sort of. There was a scene in “LA Law” on television where Artie’s secretary filed a Chapter 13 bankruptcy, and in that scene the actor playing the Chapter 13 bankruptcy trustee made a big show of cutting up her credit cards while he sneered at her and she cried. Before pontificating that she didn’t need a car, because she could take the bus! Mwah-haa-haaa!! What really happens is much simpler and less dramatic, which is, I suppose, the reason it didn’t show up on television. When you file a Chapter 7 (or 13), all your creditors are notified. And credit card companies aren’t dumb; when they find out that you filed a bankruptcy, they shut the credit spigot. It’s pretty close to automatic. If you had a card with a zero balance, so that specific credit card company wasn’t a creditor in your case, you could try filing the Chapter 7 bankruptcy, then using that zero balance card as though nothing had happened. And it might even work. But probably not, because computers get smarter every day, and banks get fewer every day. Here’s a better solution: read “Bounce Back from Bankruptcy …

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