Bankruptcy in Nevada
Because loved ones, friends, and neighbors may take the phrase, “What happens in Vegas, stays in Vegas” literally, you may not know if they’ve filed bankruptcy. You may want to follow the same mantra. This makes it hard to get a personal referral to a qualified bankruptcy attorney.
If you are looking for a bankruptcy lawyer or trying to understand whether bankruptcy is right for you, this article was written for you. We’ll show you:
- How Nevada bankruptcy law is different from the laws of other states;
- The differences between Chapter 7 and 13 bankruptcies;
- 3 ways to find a bankruptcy attorney; and
- What you need to do to prepare to work with a bankruptcy lawyer.
How Nevada Bankruptcy Law Differs from the Laws of Other States
The housing boom struck Nevada hard and many people can’t afford to keep their houses. However, if you can make the payments or your bank will allow you to renegotiate your mortgage, you can keep your house and still benefit from bankruptcy.
- Your homestead, up to $550,000 of equity, is protected.
- Your motor vehicle, up to $15,000 of equity, is protected and this is doubled to $30,000 for a married couple, filing jointly.
- Household items and personal possessions are also protected with generous exemptions.
The exemptions vary in other states and some states offer the choice of using their exemptions or the federal exemptions. There is no choice in Nevada, but their state exemptions are much more generous than the federal exemptions, so it doesn’t matter.
Nevada residents can still benefit from federal laws that protect retirement accounts and pensions.
Your Choices in Filing Bankruptcy in Nevada: Chapter 7 or Chapter 13
No matter where you reside, you have a “choice” between filing under Chapter 7 or 13 of the federal bankruptcy laws. (You may have noticed bankruptcy is a combination of both federal and state law.)
- If you qualify to file Chapter 7, you can file Chapter 7 or 13. Some people file under Chapter 11, but that’s unusual.
- To qualify for Chapter 7, you must pass the “means test”, which, in general, means that your income is below the state median income for the number of people in your family.
- For example, if you’re single and earn under $44,508, you qualify for Chapter 7.
- Or, if you have a family of four and earn under $67,236, you qualify.
- If you don’t qualify or your attorney advises that Chapter 7 is not in your best interests, Chapter 13 is likely the best fit.
- Some debts may be discharged.
- Other debts are renegotiated and reorganized so you can pay them back within a 3 to 5 year plan.
3 Ways to Find a Bankruptcy Attorney
- The best way to find a licensed bankruptcy attorney is to get a personal referral, but as we mentioned above, that can prove difficult or uncomfortable.
- As an alternative, look for an attorney who focuses his or her legal practice on bankruptcy by searching online for “Find a Nevada Bankruptcy Attorney” or by contacting your local bar association.
- Most bankruptcy attorneys will offer a free, no obligation consultation or phone interview so you can determine whether that attorney is a good fit for you.
How to Prepare to Work with a Bankruptcy Attorney
It’s likely in your best interests to work with an attorney who focuses his or her practice on bankruptcy law. If try to fly solo and make a mistake, it could cost you tens or hundreds of thousands of dollars.
Gather all of your financial documentation including debts, bills, contracts, payment plans, assets, and expenses. Also, include re-payments to creditors, including family members, which you’ve made in the last year.
Your bankruptcy lawyer will only be able to successfully guide you through your bankruptcy proceeding if he or she has all of your financial information. Be sure to jot down your questions as well and you’ll be well on your way to winning the jackpot, a fresh start.