Exemption laws protect some property from being taken by creditors if a person is sued. Exemptions also
protect bankruptcy debtors. North Carolina exemptions apply to someone who files bankruptcy in the state of North Carolina,
if they have lived in North Carolina for two years or longer. If they have lived in North Carolina less than two years, then
either Federal Exemptions of the exemptions of a former state apply.
The North Carolina Laws allow each resident to exempt (protect or withhold) from creditors, up to $18,500.00
in their residence, or in the residence of their dependent. If the debtor does not have a residence or does not need the
entire $18,500.00 exemption in the residence, they can use up to $5,000.00 as a wildcard exemption in any type of property
to the extent it is not used for the residence.
You can think of the North Carolina homestead exemption a little differently and say that North Carolina
has a homestead exemption per person of $13,500.00 in their residence, that can be combined with the $5,000.00 wildcard for
a total of $18,500.00 residential homestead exemption.
For example, if a resident claims $16,000.00 equity in their residence as exempt, they would still have
up to $2,500.00 wildcard to use elsewhere.
If a debtor in bankruptcy has lived in North Carolina for at least two years, this exemption would likely
apply to them in either a Chapter 7, Chapter 11 or Chapter 13 case.
To learn about NC exemptions and how they apply to you, please consult an attorney licensed in the state
of North Carolina, and to know what exemptions apply in bankruptcy cases, consult an experienced bankruptcy attorney. Not
understanding the laws could have serious consequences.
