On January 22, 2011, the amount of equity that an individual homeowner in New York State can protect from creditors in bankruptcy shall increase from $50,000.00 to $150,000.00.
This increase could prove to be a major benefit to boomers and retirees in our area who may:
…own their home (including coops and condos) free and clear or have a substantial equity position in their home;
…are either on a fixed income or are at an income level that would qualify them for a Chapter 7 Bankruptcy under the Means Test;
…have considered bankruptcy because of the burdens of credit card and/or other debt obligations, BUT
…have been previously unable to file for protection under Chapter 7 bankruptcy because of the amount of equity in their home.
For example, a retired couple, on a fixed income, that owns a coop apartment in Queens will now be able to protect up to $300,000.00 in equity from their creditors in bankruptcy. This change in the law will now allow homeowners to discharge their debts in bankruptcy without placing either their home or other assets at risk, assuming that you meet all of the other qualifications for Chapter 7 Bankruptcy.
If you believe that you may fall into this category, you owe it to yourself to contact our offices at (516) 268-0122 to schedule a free, non-obligation consultation in which we can assess your current situation and determine whether you may qualify for Chapter 7 bankruptcy under the new exemption guidelines.