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Bankruptcy in Rhode Island

Are there any income requirements for filing bankruptcy in Rhode Island?

If you choose to file for Chapter 13 bankruptcy in Rhode Island, there are absolutely no income requirements.  This type of bankruptcy is open to individuals and businesses of all income levels.  If you choose to file for Chapter 7 bankruptcy there is an income requirement.  The law in Rhode Island requires you to prove that your income in lower than the average income in your area in order to qualify for Chapter 7 bankruptcy.  In addition to meeting this income requirement, you will also need to meet several other requirements in order to file for Chapter 7 bankruptcy.  These requirements include a residency in the state for at least 40 months, and a period of at least 6 years since your last bankruptcy.

If I am married, do I have to file with my spouse Rhode Island?

In the State of Rhode Island, married couples do not need to file a joint petition when filing for bankruptcy.  While there is no law requiring married couples to file a joint petition for bankruptcy, most bankruptcy attorneys will recommend this course of action.  This is because, when a married couple files a joint petition they are able to take advantage of higher property exemption values, and they are able to discharge joint debt for which they are both responsible.  The only time that it is advisable for a married individual to file a single petition is when only one of the spouses are responsible for the majority of the household debt.

What are the property exemption rules in Rhode Island?

The Rhode Island property exemption rules are as follows:

Homestead exemption of up to $200,000 (this exemption will be lowered to $125,000 for residents of less than 40 months)

-Up to $10,000 in motor vehicles

-Up to $1,200 in tools of the trade or other professional materials

-Personal property including clothing, furnishings, and other items not to exceed $8,600

-Up to $300 in books

-One burial plot

Will all of my debts be discharged as part of a Chapter 7 bankruptcy in Rhode Island?

Not all debts are able to be discharged as a result of Chapter 7 bankruptcy settlement in Rhode Island.

The following are some examples of debts which can be discharged during bankruptcy:

-utility bills

-medical bills

-credit cards

-store credit lines

-unsecured loans

Some examples of debts which can not be discharged as part of a bankruptcy are:

-car loans

-mortgages

-home equity loans

-collateral loans

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