Know the law. It’s on your side.
- With the new laws it’s not worth it to file for bankruptcy.
>False. The new law effective October 2005 allows you to quality for a Chapter 7 bankruptcy if your household income is less than your state’s median, or if you pass a “Means Test” to see if you have qualifying, low disposable income.
- I have to have a large amount of debt before qualifying for bankruptcy.
>False. The question to ask is, “Is my debt load overwhelming compared to the amount of disposable income I currently have?”
- I will lose everything I own including my car and home.
>False. Every state has exemptions which allow you to keep bare necessities. Insert link to info below in red. A place to live and a way to drive to work could be considered bare necessities.
- It will take at least seven to ten years for my credit to recover from bankruptcy.
>False. Even with a bankruptcy showing for up to ten years, you can begin to build credit immediately after filing. The national average shows credit can be recovered in as little as eighteen months.
- Everyone will know I’m a bad person if I file for bankruptcy.
>False. Someone must specifically be searching for your bankruptcy to find it in the public record. Always remember that bankruptcy provides relief. It is not a punishment demanded by your creditors. Law makers enacted laws to allow people to financially have a fresh start.
- After I file for bankruptcy creditors can still garnish my wages.
>False. In Chapter 7 bankruptcies any wages you earn after the filing are yours to keep. Chapter 13 bankruptcy includes a pre-approved plan to pay off debt over a specific amount of time. In this case part of your earnings will be applied to your debts.
The following is a list of property that is generally exempt from seizure or collection under Utah law :
- Burial plot for you or anyone in your family; ;
- Health aids that are reasonably necessary ;
- Public Benefits such as General Assistance, Social Security, Disability, Unemployment, Worker’s Compensation, ;
- Benefits used for medical, surgical, or hospital care for you and your dependents ;
- Veterans Benefits ;
- Child Support ;
- Alimony and separate maintenance ;
- Money or assets in a Qualified Domestic Relations Order (QDRO) ;
- One clothes washer & dryer, refrigerator & freezer, stove & microwave, and sewing machine ;
- All Carpets in use at your house ;
- Food and other provisions sufficient for 12 months for you and your family ;
- Clothing that is reasonably necessary (not including jewelry or fur coats) ;
- Beds and bedding for you and your immediate family ;
- Artwork depicting or produced by you or immediate family (unless such artwork is held as part of a trade or business) ;
- Insurance proceeds, judgment, or settlement that are compensatory for bodily injury or wrongful death to you or to someone for whom you are or were a dependent ;
- Cash value of Life insurance policy ;
- Pensions, IRA, 401(K) plans and retirement plans ;
- Sofas, chairs, and related furnishings reasonably necessary for one household, up to a total value of $500 ;
- Dining and kitchen tables and chairs reasonably necessary for one household, up to $500 per debtor ;
- Animals, books, and musical instruments, up to a total value of $500 ;
- Heirlooms or other items of “particular sentimental value” up to a total value of $500 ;
- Implements, professional books, or tools of your trade, all having a total value not exceeding $3,500 ;
- Motor vehicle (1) not exceeding $2,500 in value, used primarily for daily transportation, and not used for recreational purposes ;
- Cars with equity up to $2,500 ;
- House or primary personal residence with equity up to $20,000 per debtor ;
- Real property that is not primary personal residence with equity up to $5,000 per debtor ;