Asked about 2 years ago - Oviedo, FL
FlagI am filing bankruptcy and my husband is not. We purchased a motorcycle together and put $11,000 down. There is now $6000 in equity. How much of an exemption do I need so that we can keep the motorcycle.
Not sure why you need to hear about how California is a community property estate.... it has no bearing to you and only confuses your issues.
You need to protect $3000 of equity, assuming the trustee accepts the valuation you have placed on the motorcycle.
In Florida, you get a $1,000 vehicle exemption, $1,000 personal property exemption, and an extra $4,000 exemption to use on any property - as long as you are not keeping, or do not have, a residence as your homestead.
This needs careful consideration by an attorney since there are recent state supreme court rulings on when one can use the extra $4,000 exemption or not.
But in your case, I suspect a significant portion, if not all, of the motorcycle may be exempt. But without a full consultation as to all matters, no one can give you a definitive answer.
To get a proper answer your question, you need more in-depth analysis from a knowledgeable attorney. We, for instance, give you a comprehensive consultation for free and will meet prices of any other attorney.
If there is equity on the part of you and your husband totalling $6,000 in the motorcycle, you are going to need $3, 000.00 exemption for your part. It makes a difference as to how it is titled and with some trustees, whether there is an "and" or an "or" between the names.
If it is your only vehicle, you will likely be able to use your motor vehicle exemption of $1,000 and will need $2,000 from your "wildcard" personal property exemption. How much that is depends on your homestead. If you retain your homestead, then you will not have enough and likely have to do a buy-back of the excess.
THESE COMMENTS ARE NOT INTENDED AS LEGAL ADVICE, are for informational purposes only, and should not be relied on as legal advice. This response is not intended to create any attorney-client relationship and is only based on the limited facts given. It is recommended that you consult with an attorney who can properly assess the pertinent facts prior to taking any action.
If this response has helped you, please click and vote ^ below.
You first need legal advice to value your property. Bankruptcy law provides for property valuation in a different way than you may have thought and a lot of the way something is valued is based on local rules.
Since you have a 1/2 ownership in the vehicle, if the equity is actually $6,000, your equity would be $3,000.
Hope this perspective helps!
Bankruptcy entails a "liquidation analysis." This implies that costs of sale and trustee commissions--which reduce the yield for creditors--can essentially increase the relevant "equity." A trustee will not generally liquidate assets if there would be no "meaningful" distribution to creditors after all was said and done. This is an important consideration if limited exemptions must be carefully doled out and distributed among different assets.
In a community property state, such as California, marital acquisitions must be exempted in full even if a single spouse is filing.
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