US Legal Forms
Legal Resources
Questions & Answers
Bankruptcy
Can I keep my Indiana properties if I file for Chapter 7 bankruptcy?

Can I keep my Indiana properties if I file for Chapter 7 bankruptcy?

Full question:

I am considering bankruptcy. I have lived in Florida for 1 year, and my house has a homestead. I have no equity in it. I would like to keep it. My mortgage payment is $1389. I also own 2 properties in Indiana that I want to keep. 1 property is a Apartment Building / paid in full/ in a LLC. The other is a home which used to be my primary residence which has been for sale for 2 years. The price right now is $239,000 and I owe $175,000. Payment is $1245.00 I am also renting it for $800.00 per month. My total income from Retirement Pension, Income property, and a part time job is $5700. I have $55,000 in Credit Card Debt, $243.00 Car Payment. I would like to file chapter 7. I did the Means online calculator and I qualified for 7. However I am worried about the Indiana properties.

Category: Bankruptcy
Date: 04/07/2025
State: Florida

Answer:

In Indiana, if you file for Chapter 7 bankruptcy, you can claim certain exemptions for your properties. For real estate that is your personal residence, you may claim an exemption of up to $15,000. If the property is not your residence, the exemption is $8,000 (Ind. Code § 34-55-10-1). Since your apartment building is owned by an LLC and not personally, it may not be exempt.

For your home in Indiana, the exemption applies only if it is classified as your personal residence. You owe $175,000 on it while it is currently valued at $239,000. If you are unable to sell it, the rental income of $800 per month may help cover your expenses. However, be aware that the bankruptcy trustee may consider the equity in the property when determining whether you can keep it.

It’s essential to consult with a bankruptcy attorney who can provide specific guidance based on your situation and help you navigate the complexities of Indiana bankruptcy laws.

This content is for informational purposes only and is not legal advice. Legal statutes mentioned reflect the law at the time the content was written and may no longer be current. Always verify the latest version of the law before relying on it.

FAQs

What assets are not protected in bankruptcy?

In bankruptcy, certain assets may not be protected, including luxury items, cash over a specific limit, and non-exempt real estate. Additionally, if you have significant equity in your home or investment properties that exceed exemption limits, that equity may be at risk. Bankruptcy laws vary by state, so it's essential to consult local statutes and a bankruptcy attorney for specific guidance on what is exempt in your situation.

What are the exceptions to the Florida homestead exemption?

In Florida, the homestead exemption generally protects your primary residence from creditors. However, exceptions exist for debts related to taxes, mortgages, and construction liens. If you acquired the property through fraudulent means, it may also be exempt from protection. Always consult a legal professional to understand how these exceptions may apply to your case.

Can you declare bankruptcy if you have equity in your home?

Yes, you can declare bankruptcy even if you have equity in your home. However, the amount of equity may affect whether you can keep the home. In Indiana, for example, you can exempt up to $15,000 in equity for your primary residence. If your equity exceeds this amount, the bankruptcy trustee may consider it when deciding if you can retain the property.

Is homestead exempt from bankruptcy in Florida?

Yes, in Florida, a homestead is generally exempt from bankruptcy, protecting your primary residence from most creditors. This exemption can cover the entire value of the home, provided it meets certain criteria. However, exceptions may apply, such as for mortgage debts or tax liens. Consult a bankruptcy attorney for detailed advice based on your circumstances.

Can I keep my home if I file bankruptcy in Florida?

Yes, you can typically keep your home if you file for bankruptcy in Florida, thanks to the homestead exemption. This exemption protects your primary residence from creditors, allowing you to retain ownership. However, if you have significant equity or are behind on mortgage payments, it’s important to consult a legal professional to understand your options.

Is there a homestead exemption for bankruptcy in Florida?

Yes, Florida has a homestead exemption that protects your primary residence from creditors in bankruptcy. This exemption can shield the entire value of your home, provided it meets specific criteria. However, it's essential to be aware of exceptions, such as for mortgage debts. Consulting with a bankruptcy attorney can help clarify how this exemption applies to your situation.