One of the most frequently asked questions from our Massachusetts personal bankruptcy clients is, “Can I keep my car?” The answer, generally, is yes. However, in a Chapter 7 personal bankruptcy case in Omaha, an heir to a fortune filed for personal bankruptcy protection last month and had to surrender his Maserati, which was sold by the Bankruptcy Trustee for $58,500.
In that case, Ted Baer’s vehicle was sold and the proceeds went to pay off the vehicle loan, the secured creditor, and the remaining balance was added to the bankruptcy estate. Nevertheless, most of our clients don’t have a Maserati, or another extravagant vehicle. They simply have a vehicle that they need to go to work and to get around. When using the federal bankruptcy exemptions, our clients keep up to $7,500 of equity in their vehicle.
More importantly, the federal bankruptcy exemptions allow debtors to combine exemptions if they do not use all of one exemption. In addition, the Massachusetts state exemptions, which allow for a significant homestead exemption of up to $500,000, also allow an exemption for motor vehicles, albeit a much smaller exemption.
For questions about the federal or Massachusetts motor vehicle exemptions, call us at 617-227-7423. You will get a free telephone consultation with an experienced bankruptcy lawyer.