Do I Need to Live in South Carolina for a Certain Amount of Time to File for Bankruptcy Here?
If you are considering bankruptcy as an individual, you may be able to file under Chapter 7, Chapter 11, or Chapter 13. Your specific financial situation will dictate which chapter you can apply under, with many individuals qualifying for more than one type of bankruptcy. To be eligible to file for bankruptcy in South Carolina, an individual must be a resident for at least 91 days but will need to live there for a minimum of two years to claim the state’s bankruptcy exemptions.
At Reed Law Firm, we know that choosing to file for bankruptcy can be a stressful decision made after many hours of exploring your options. If you are currently trying to rectify your debt situation, our Columbia, SC, bankruptcy attorneys are here to guide you through the process from start to finish.
Chapter 7 versus Chapter 13 Bankruptcy
Bankruptcy allows an individual to significantly reduce or eliminate debt. In most cases, individuals are able to keep their home and car. Most individuals file for either Chapter 7 or Chapter 13 bankruptcy. Whereas Chapter 7 allows individuals to liquidate assets to pay off creditors, Chapter 13 gives you the option to restructure your debt, paying it off gradually. If you choose to restructure your debt, you will submit a proposed repayment plan outlining how you will pay back creditors. In Chapter 13 bankruptcy, proposed repayment plans typically last anywhere from three to five years.
Bankruptcy Property Exemptions
When you apply for bankruptcy, certain property will be exempt, free from seizure or liquidation. The exemption amount will be based on your equity in the property. Property equity is calculated by taking the current market value minus any outstanding liens or mortgages.
While some states recognize federal bankruptcy exemptions, if you file for bankruptcy in South Carolina, you must use the state exemption amounts. In accordance with S.C. Code §15-31-40 (A), the exemption amounts are as specified (as of July 2024):
- Homestead: $76,125 for a single filer, with a married couple filing joint bankruptcy being permitted to claim $152,250. If you do not own a home, the exemption can be applied to a burial plot valued at $76,125.
- Motor vehicle: $7,600 individually in your vehicle, or $15,200 for a married couple.
- Household furnishings: $6,100 individually or $12,200 jointly.
- Jewelry: $1,525 individually or $3,050 jointly.
- Cash and liquid assets (only if not using homestead exemption): $7,600 individually or $15,200 jointly.
- Professional books or tools of the trade: $2,275 individually or $4,550 jointly.
- Wildcard exemption (can be applied to any property you own): $7,600 individually or $15,200 jointly.
Residency Requirements When Filing for Bankruptcy
You must be a resident of South Carolina for a minimum of 91 days before filing for bankruptcy. However, if you have lived in the state for less than two years, you will have to use the exemptions of the state from which you moved. While some states require that you use state-specific exemptions, others will give you the option of choosing between state or federal exemptions.
At Reed Law Firm, we are aware that bankruptcy law is complex. Our Columbia bankruptcy lawyers are here to explain the court process and what to expect, placing you at ease. Our legal team is here to help you make informed decisions, getting you out of debt and helping you obtain peace of mind.
Seeking Debt Relief? Speak with Our Columbia, SC, Bankruptcy Attorneys Today
If you have recently experienced a medical emergency, have been laid off, or simply cannot afford your credit card payments, do not hesitate to reach out to the legal team at Reed Law Firm. There is a misnomer that anyone can avoid bankruptcy through strict budgeting and personal accountability. The sad truth is that the misfortune of bankruptcy can happen to just about anyone, impacting your ability to pay your mortgage, make your car payments, or put food on the table. If you are interested in discussing what debt relief options make sense for you, contact us online to schedule a free consultation with one of our Columbia, SC, bankruptcy attorneys.
