Essentially this means that when a bankruptcy is filed, a debtor must list all the property they own or have an interest in. They must list assets such as real estate, vehicles, household goods, financial accounts, inheritances, businesses, potential active lawsuits they have against someone else, royalties, income, settlements, insurance funds, retirement accounts, tax refunds, and much more.

A debtor must list all their assets or potential assets in a bankruptcy case to ensure the court is fully aware of all property they own or have an interest in. However, just because the debtor must list all these types of property, does not mean they lose their property.

Bankruptcy has what are called exemptions that are governed by state laws. Exemption is what we refer to as the protections for certain property that a debtor can keep and retain through a Chapter 7. Once a debtor lists all their assets in their paperwork, they get to abide by the laws of the state where they filed and protect certain property from the bankruptcy court and trustee. The exemptions allowed in each state may determine what type of bankruptcy a debtor may file if they want to keep.

You may have heard some Chapter 7 cases referred to as a “no-asset case.” A no-asset case does not mean that a debtor owned or had an interest in nothing. It means that the debtor listed all their assets and interests in their paperwork, but state law helped exempt / protect those assets from being taken by the trustee and used to pay unsecured creditors. In an “asset” Chapter 7, the debtor would have non-exempted / unprotected property that the trustee can take and use to pay towards unsecured creditors that would generally be eliminated (or discharged) by the bankruptcy case.

For example, in Mississippi, your homestead equity, or equity of the home you physically reside in, is protected up to $75,000.00. If a debtor owned a single-family home, that was worth $100,000.00 and they had a mortgage totaling only $25,000.00, they would have equity of $75,000.00 and it would be exempted, and the Trustee could not take it. However, that homestead exemption only applies to your physical residence and if that same debtor had another home, the trustee could take possession of that home, sell it, and use any profits to pay towards the debtor’s unsecured debt.

Have no fear because there are ways to protect property that has no exemptions and is at risk of being taken by a Chapter 7 trustee, such as filing a Chapter 13 case instead. You must always be completely honest and upfront when speaking to your bankruptcy attorney so they can help you navigate all the exemptions and potential issues. Please speak with a bankruptcy attorney before you attempt to get rid of property if you want to file bankruptcy. An attorney can explain the consequences along with other options to help you keep non-exempted property. You never want to panic and start to transfer your property to other people because it is fraudulent, and not only can the court reverse the transfer they can deem it fraudulent and pursue criminal action. Always keep your property as is and discuss everything with a bankruptcy attorney first as they can help you determine which bankruptcy to file and how it would affect your assets.

Previously mentioned, filing a Chapter 13 can help you protect non-exempt assets that would be taken by a Chapter 7 trustee. A Chapter 13 is a reorganizational plan that can be up to 5 years. When a debtor has property with no exemptions that apply, they can file a Chapter 13 to retain that property by paying the value or equity of that property over time in the plan to their unsecured creditors.

If we take our previous example of the debtor who has a second home that is unprotected, if that debtor filed a Chapter 13, there is a way they can retain that extra home. Let’s say that second home is paid off and worth $50,000.00. Rather than filing a Chapter 7, where the Trustee would take and sell that property to pay unsecured debts, the debtor files a Chapter 13 to retain it. A Chapter 13 trustee would not attempt to take the property but would have the debtor pay the value ($50,000.00) over a 5-year plan towards their unsecured creditors. A Chapter 13 can be a “pay to protect” type of bankruptcy where you can keep the unprotected property, and your unsecured creditors are treated fairly.

The purpose of bankruptcy is a fresh start for the debtor and equity among creditors. The debtor with two homes can choose to keep his second home and pay unsecured creditors over time in a Chapter 13 or he can choose to file a Chapter 7 and have them paid quicker and be done with his bankruptcy sooner. In either situation, his unsecured creditors are treated equally. If the debtor did not have a second home, then there would be nothing to pay towards unsecured creditors because he utilized his exemptions and does not have to pay unsecured creditors anything.

Even though bankruptcy is in Federal Court, each state sets up their own exemption laws of what types of property and interests can be retained and protected. There are also exemptions set up by Federal law that can be used if a state chooses to allow it. It is important to speak with a bankruptcy attorney to be aware of all of your exemptions and options so you can utilize the right bankruptcy to help match your goals while staying within the law.

Even though some may think that reckless spending habits might play some role in this, the reality is that more and more Americans are being forced into credit card debt trying to pay off monthly living expenses. Over the last two years, as inflation has taken hold of the economy, the cost of necessary goods has hit the roof. A newly released report from Moody’s shows that the average American family pays $709 more now each month for the same goods they were purchasing in 2021.  With around 60% of Americans living paycheck to paycheck and 54% saying they wouldn’t be able to cover an unexpected $400 payment, it only takes a small monthly change to drive people into debt just to make ends meet. Another side effect of the Fed’s continuous rate hikes, the average credit card interest rate is now around 20% (which is the highest mark on record), translating to the cost of that debt being even higher.

Keep in mind that one of the fastest ways to negatively impact your credit score is to max out your credit card debt. It doesn’t matter that you’re paying on time nearly as much as it matters that you have maximized all available credit limits. If you are only paying minimum credit card payments monthly, you will be paying on that credit card debt for years and years. It will take a long time to ever pay down this debt, even enough to the point to regain traction on your credit score.  One small change in your income or overall financial situation can then cause late payments, which tank your credit score even further.  Without a decent credit score, lenders are unwilling to provide you with debt consolidation loan options.  Or if they do, they are at enormous interest rates. Many consumers, over the past two or so years, have consolidated their credit card debt only to then again run up the credit cards that were paid off in the consolidation.

If you are entering repayment or beginning your student loan payments for the first time, there are 3 things you should do now.

1. Make a budget – take a hard look at your monthly income and expenses.

The best way to stop an Order of Replevin is to not let it get to the stage of the Order being issued. You need to address things once the lawsuit has been filed against you by the person/company seeking the Replevin – stopping an order from being issued in the first place. This lawsuit is filed and called a “Writ of Replevin”. When you receive notice of this lawsuit, respond! If you fail to do anything, an Order of Replevin will be issued to the person/company seeking it. You should have received a Replevin Summons (Notice to Appear in Court) and been given 20 days to respond to the lawsuit to fight it. If you fail to respond, the person/company will file for a default judgment.  After the default (or final hearing), the judge will grant the final judgment (Order of Replevin).

Speak with an attorney. You can stop a Writ of Replevin by fighting the lawsuit itself or, if the debt is legitimate and you are behind without the ability to catch up, you can file a Chapter 7 or Chapter 13 Bankruptcy case.  The bankruptcy case will stop the Replevin action in it’s tracks. Depending upon which type of bankruptcy you file, you will either retain and pay under new terms for the property or you will surrender the property at a later date, established through the bankruptcy court process.

Unlike repossession, a replevin entitles you to some due process before the creditor can take the collateral (property) from you.  This means you must receive written notice of the creditor’s intent to get a replevin order, you have an opportunity for a hearing, you will receive written notice of the time, date, and location of the hearing, and you have the right to dispute and/or respond to the complaint.  The time to respond and/or request a hearing varies by state, but it is typically short.

A replevin can apply to different situations, including a circumstance of where two parties both have rights to the possession of property, but one party might have more rights to that property than the other party. It can also apply to situations where property that has been lawfully withheld but should have been released later to a person, but was not released.

MS Statutes of Limitations on Civil Matters – MS Code § 15-1 

Of course this 2013 MS Code Title 15 – Limitations of Actions and Prevention of Frauds § 15-1 covers more than just civil statutes, but for the purpose of this discussion, we will focus only on civil statutes, and even more specifically, collection of debt and judgments.   So first of all, what do we mean by civil statute of limitation? The definition is a statute prescribing a period of limitation for the bringing of certain kinds of legal action. In other words, this law sets the maximum amount of time that a party has to initiate legal proceedings against another party they have a dispute with and the time starts from the date of an alleged offense – whether criminal or civil.

Maybe you’ve had a car accident and it’s been a while or you have an old credit card debt, hospital bill, or other issue that you thought was long gone, but you’ve been served papers regarding a new or updated lawsuit. Hasn’t enough time passed? How are they still suing you over this issue?   Collection of Debt on Account is covered under Mississippi Code 15-1-29 and states a 3 year limit.   A Judgement (a lawsuit that was filed against you and was ruled in favor of the company/person that filed against you) is covered under Mississippi Code 15-1-43 and states a 7 year period.  The courts have these limitations in order to create as much fairness and predictability as possible. You have a certain amount of time for legal action to be taken against you and it guarantees that you don’t have unfinished legal matters hanging over your head indefinitely. There are deadlines and all parties must take action accordingly or take no action at all.

We get asked this question a lot. I mean A LOT. There is no law that states your property cannot be repossessed unless you are a certain amount of time behind. You can be 1 day behind or 4 months behind. The lender is the one that decides when to take that action and they can take that action the moment you fail to fulfill the loan agreement you have with them.  Different lenders have different policies and procedures.  Know what your lender’s policies and procedures are regarding repossession now.  Don’t wait to know what will happen because it more than likely will catch you by surprise. Hopefully you will never need to know their process and procedure for this – but the saying “knowledge is power” is true.

Most repos occur after two+ months of no payment, but there is NO LAW dictating a set time frame in MS.

First, see what assistance your lender has to offer

Find out what kind of programs your bank, credit union or other auto loan lender has available.  Also, get familiar with Mississippi Repossession Laws to know what can and cannot be done. Most of the automakers no longer advertise their payment relief programs. If you are facing missing a payment due to a job loss (from the pandemic or whatever other reason), the best thing to do is to contact your lender. Explain your situation, and hopefully they may be able to offer some short term assistance like a payment deferral, a partial payment option or a lease extension.

• You signed an agreement and used the property as collateral for the loan.
• You failed to honor the terms of the loan agreement (note: the property may be put up for repossession immediately).