Debtors are given the choice between federal exemptions and local exemptions.

Among the many things to think about when considering bankruptcy, is “Which set of exemptions should you use?”  The book, Personal Bankruptcy For Dummies, speaks of the choice that debtors are faced with.

The book says:

“Although bankruptcy law is generally the province of the federal government, a number of states have their own provisions with regard to exemptions, giving people the chance to choose between exemptions offered under the Bankruptcy Code (federal exemptions) and those provided by their own state legislature.”

The book goes on to list several states, among those, Texas, where the following rule applies, “Debtors can choose local or Bankruptcy Code exemptions, based on the jurisdiction where they lived for the longest period during the 180-day span immediately preceding the petition date.”

Also, an important thing to mention is that debtors can’t pick and choose different exemptions.  You have to use one set of exemptions or the other.  If you thought that you could just pick different ones here and there, think again.

A debtor will of course choose the set of exemptions that will benefit them the most, but the hard part is figuring out which set of exemptions is the best for your situation.

A high-quality bankruptcy attorney will know all of the little known details of the different sets of exemptions, so it is important to get expert advice.  If you are faced with difficult financial decisions, contact a bankruptcy attorney as soon as possible.  The amount of help that an attorney can provide will out weigh any cost that you are afraid of.  Find out what exemptions you will be allowed, by contacting a bankruptcy attorney.