In the current housing market, many homeowners have seen the value of their home depreciate to the extent that their mortgage payments often exceed the market value of their home. While struggling to make ends meet and paying high mortgage payments, homeowners may find themselves facing foreclosure. One way to put an automatic stay on foreclosure proceedings is filing for bankruptcy, and this may be the reason the leader of the second-largest school district in one of Arizona's cities filed for bankruptcy recently.
When it comes to a bankruptcy exemption, Arizona residents are lucky to have a long list that has recently been updated to include more items that filers can hold on to. Even though bankruptcy protection is federal law, each state can create a guideline for what is protected from creditors.
When it comes to household items, legislation coming into effect later this year has been signed, increasing the monetary value by 50 percent of what it was previously. In addition to this, where previously the list of exempt household assets was very specific, now filers can keep any item that remains below the limit, regardless of the mix.
In addition to this, possibly recognizing the sentimental importance of some assets, the values of wedding and engagement rings that can be kept has also increased in the new bill. Also, business items are now exempt from being taken away. It is difficult enough to file for bankruptcy due to financial difficulties; however, the business exemptions will allow filers to continue working by allowing them to retain possession of phone numbers, website domains and other marketing tools.
As the superintendent himself conceded, filing for bankruptcy will not impede his job. It may, however, allow him to continue working without financial stress looming over his head. Most of his bills and taxes may be wiped out, while he retains control over a number of household and personal possessions.
Source: Arizona Daily Star, "Sunnyside's Isquierdo files Chapter 7 bankruptcy," Jamar Younger, May 22, 2013