Bankruptcy laws in Georgia protect consumers against the debt collecting practices of some creditors. For those overwhelmed with debt, bankruptcy provides a chance to start over.

Bankruptcy Exemptions

Georgia bankruptcy laws protect some assets from being seized to pay debts. These include:

• Up to $10,000 for your home, provided you or your dependents use it as their residence. If you have less than $5,000 in equity, you can claim the homestead exemption, which allows you to keep your house if you keep your mortgage current.
• Up to $300 per item for furniture, clothing, books, animals, appliances, crops, and musical instruments, not exceeding $5,000 total value
• Health aids prescribed by a professional
• Up to $500 for jewelry
• Public benefits
• Alimony or similar payments as needed for support
• Up to $1,500 for professional books or tools of the trade
• Crime victims’ compensation
• Personal injury payments, up to $10,000
• Payment for loss of earnings as needed for support
• Payment for wrongful death as needed for support
• Life insurance payments from someone you depended on for support
• Unmatured life insurance contracts
• Up to $2,000 in interest for any unmature insurance contract with a loan value
• Up to $600 in interest for any property, plus up to $5,000 of unused homestead exemption

In addition, you may keep up to $3,500 for your vehicle. If you have more than $3,500 in equity in your car, you may be able to keep the car if you can pay the difference to your trustee. If you still owe money on the car, you must reaffirm your debt within 45 days of your 341 meeting.

Chapter 7 Bankruptcy Information

Those who are not trying to keep their home and are not in danger of losing their cars in bankruptcy may wish to file Chapter 7. This allows the trustee to sell off non-exempt assets to pay creditors, and then wipe out any remaining debts. You may only file Chapter 7 if you have passed the means test, which states that you have to make at or below the median income level for your state to file Chapter 7 bankruptcy.

Chapter 13 Bankruptcy Information

Chapter 13 bankruptcy makes more of an attempt to pay back the debts, just with the benefit of court supervision and protection. Under Chapter 13, debtors enter into a repayment plan with trustee supervision that attempts to pay back debts over approximately five years. Often under Chapter 13, larger assets, such as houses or cars, are protected through the repayment plan.