• Homestead laws protect property from unsecured creditors.stairway to the beach image by Pix by Marti from Fotolia.com
  
  The U.S. government revised the country's bankruptcy laws in 2005 in an effort to deter bankruptcies, especially Chapter 7s. Applicants must be permanent residents of the state of Florida for at least two years before filing bankruptcy. Exemption laws in the state permit an applicant to retain many of his personal possessions and, in most cases, his home. Florida's homestead law also provides protection against non-secured creditors.
  
  

Homestead Law

• Section 4, Article X of the Florida State Constitution permits a permanent resident in the state of Florida to exempt her property as a homestead from forced sale law. The statement must be in writing and notarized, contain a property description and note the book and page number containing the title record. Written notice must be supplied to any creditor regarding the homestead status. Any creditor that fails to file for a Declaratory Judgment in circuit court forfeits all rights to the property.
  
  The portion of the land that includes the residence qualifies as exempt. Regardless of value, less than 160 acres located outside of a municipality or a half acre in a municipality qualify under the state's homestead laws.
  
  

Money

• According to Title 25 of the Florida Code, the paycheck of a head of family whose disposable earnings are $500 a week or less is exempt from attachment or garnishment. Disposable or net earnings are those funds remaining after deductions required by law. If his net earnings are greater than $500 a week, federal law prohibits a garnishment in excess of the lesser of 25 percent of the net earnings or 30 times the federal minimum wage. Bank deposits from the previous six months are exempt.
  
  Life insurance policy benefits, cash values, annuities and disability income are exempt from garnishment.
  
  

Exceptions

• Some judgments and liens are exempt from Florida's homestead protections. Exceptions listed in the Florida Code include taxes and related property assessments, mortgages and other contracts related to the property, and any form of labor, services or materials furnished to maintain, repair or improve the property.
  
  

Bankruptcy Exemptions

• According to the McCue Law Firm, if you purchased the home at least 40 months before declaring bankruptcy, the same homestead exemptions remain. If you purchased it more recently, bankruptcy laws permit only $137,000 worth of equity. Effective July 1, 2007, a debtor who leaves the homestead exemption unclaimed may claim an additional $4,000 in personal property exemptions per debtor.
  
  In Florida filers can claim a $1,000 personal vehicle exemption and a $1,000 exemption for clothing, jewelry, furnishings, tools, cash or other belongings. The exemptions are doubled for two debtors. When each debtor claims a vehicle, the $1,000 exemption applies to each vehicle. You can also apply the $2,000 to one shared vehicle.
  
  The Law Office of Jonathan B. Alper website states that pensions, tax-deferred retirement accounts, Social Security income, annuities, disability benefits, cash value of life insurance, prepaid college investment plans and hurricane and health savings accounts are all exempt in the state of Florida.