The debtor exemption bill passed Second Reading in the Senate as Engrossed Version, House Bill 1262. Debtors will enjoy an exemption to execution on their property to satisfy a judgment or exemptions in bankruptcy in the following amounts:
Here is a provision I’m not sure about though. It’s talking about personal property being sold to satisfy a lien:
If indebtedness secured by a valid lien is chargeable against the proceeds of the sale, a bid may not be accepted if the bid is less than the sum of the amount of the indebtedness secured by the lien and the exempt value of the property.
So, let’s say you have a lien in the amount of $20,000. Say the debtor has a car worth $15,000 securing the lien. Is this provision saying that a secured creditor can’t force the sale of the car for $15,000, exempt the first $8,000, and pay the creditor the remaining $7,000? Because, as I read that provision, you can’t sell the personal property for less than $28,000 (the sum of “amount of secured indebtedness” + “exempt value of the property.”) That doesn’t seem right. Hopefully I’m misreading the provision.
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