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Im planning on filing bankruptcy in southern california im filing on 704 but i came across a problem i have to vehicles that im

San Diego, CA |

two vehicles im paying and they have no equity i owe more than there worth can i protect both vehicles. im scared and need an answer it says that we can only exempt for one vehicle

Attorney Answers 8

  1. You can exempt more than one as of 1/1/13 ... but you don't need to exempt any, since you have no equity. It sounds like you're going to need an attorney on this one.

  2. Exemptions protect equity in property. Using the 704 exemptions, you can only equity in one vehicle in the amount of $2725. A Chapter 7 trustee will only take property if it has nonexempt equity that can be used for the benefit of your creditors.

    The 703 exemptions are more popular because the unused portion of the homestead exemption can be used as a "wild card" to protect other property. And if you are sacred of losing something to a Chapter 7 trustee, you can always consider Chapter 13 as well. However, the 703 homestead exemption is very small compared to the 704 exemption.

    Do yourself a favor and call a local bankruptcy attorney. There are plenty of good attorneys in San Diego County that will at least take your call at no cost.

    First, the firm is a debt relief agency according to the U.S. Bankruptcy Code. We help people file for bankruptcy. We also do other stuff and we do it well, but Congress wants me to post this notice. Second, nothing on this site is legal advice. You are not my client unless you enter into a written agreement signed by you and me.

  3. If neither vehicle has any equity an exemption won't do anything for you. You need to consult with an attorney even if only on an "as needed basis" to keep costs down.

  4. If neither vehicle has any equity an exemption won't do anything for you. You need to consult with an attorney even if only on an "as needed basis" to keep costs down.


    The above is general legal and business analysis. It is not "legal advise" but analysis, and different lawyers may analyse this matter differently, especially if there are additional facts not reflected in the question. I am not your attorney until retained by a written retainer agreement signed by both of us. I am only licensed in California. See also terms and conditions item 9, incorporated as if it was reprinted here. Please visit my web site: for more information about my services.

  6. Vehicles that have no equity don't need an exemption! You just have to pay the notes on these vehicles to keep them. The bankruptcy exemptions are only necessary to protect property that does have equity. Hope this perspective helps!

  7. I humbly disagree with my colleagues. The information is outdated. Exemptions have been raised. Under 704.010 the number has been bumped up to $2,900. Under 703.140(b)(2) the number has been bumped up to $5,100.
    Code 703.140(b)(2) reads as follows: The debtor's interest, not to exceed four thousand eight
    hundred dollars ($4,800) in value, in one OR MORE MOTOR VEHICLES. Emphasis added. So you can put the exemptions across more than one vehicle. The $4800 number is old. Here's a link to the code:

    I agree. Hire a lawyer. Too many things can go wrong.

    I am not YOUR lawyer. Don't rely on answers to questions as legal advice. For legal advice contact a Bankruptcy Attorney for a consultation. Tokarska Law Center is a Federal Debt Relief Agency representing individuals and businesses in filing for bankrutpcy protection under the U.S. Bankrutpcy Code. Kathryn U. Tokarska is a San Diego Bankruptcy Attorney, owner of Tokarska Law Center, 185 West F Street #100, San Diego, CA 92101, (619) 285-1992

  8. My esteemed colleagues are correct, no equity, no exemption however what everyone of my colleagues have failed to mention is that most car note holders require a reaffirmation agreement for you to keep the car. This ties directly to your schedule I & J and whether or not you can truly afford the vehicles. Most car note holders do not allow you these days to pay and ride through bankruptcy. When presented with a reaffirmation agreement a presumption of abuse will arise or it will not arise. Depending on the financials, the presumption may arise and you will be forced to file a reaffirmation agreement with the court that will be reviewed by the judge and whether its in your best interests to keep the vehicles. You mentioned you owe more than they are worth. Hire a lawyer and get good consult as I have seen courts reject reaffirmation agreements. Reaffirmations are not a slam dunk anymore. I hope this additional information sheds light on exemptions for equity and presumptions of abuse on car notes that can be problematic for the debtor. GET AN ATTORNEY!!!!!

    Internet or Blog advice is merely educational in nature. There is no substitute for seeking your own counsel and benefiting from in person legal counsel. Every person is different therefore every situation is also different.

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