[Single Filers] How is it that you can exempt ~$12k cash in the bank but still declare bankruptcy?

[leonel9]

Keep in mind this is the unused portion of the homestead exemption. I guess it's possible someone would have $12k in cash laying around, and able to exempt it. It's also possible that someone with $12k in the bank is also a homeowner, and as such may be concerned about their homestead exemption. If they have enough equity, there may not be any unused exemption available.

[Chrysalis]

In the state of Indiana, for the two of us filing jointly, we are allowed a total of $800 in all accounts, anywhere. That feels pretty darn destitute for a family of five.

[LadyInTheRed]

Sure, the creditor's would like that money. But, the law states that every debtor has a right to exempt certain assets from collection by creditors. In BK, the creditors are no longer the ones in control and don't get everything they want. You aren't expected to become destitute to file BK.

[Fminus]

Hey BK Forum,

I've been reading up on the federal wildcard exemption that is available in my state. It seems, based from what I've read, a single filer can exempt up to ~$12k in cash. How is it allowed for people to save up $12k cash, exempt all of it using the wildcard, and then declare bankruptcy? Wouldn't your creditors want a piece of that pie instead of a person saving it all up?

Thank you.