Property you can Keep in Bankruptcy
What Property Can You Keep in Bankruptcy?
One major concern that many people have when filing for bankruptcy is what property they are allowed to keep. Just because you are planning to file for bankruptcy does not mean that you have to give up everything. In fact, you may be able to keep all or at least most of your items in a bankruptcy.
Exempt Property in Bankruptcy
There are certain items that are considered exempt in a bankruptcy, meaning that you are allowed to keep it, with certain stipulations. Exempt property has a fixed value cap depending upon what type of property it is.
Even if you file for Chapter 7 Bankruptcy, and a trustee sells your property to pay off creditors, you can keep exempt property considered necessary for living and working, including:
- Personal Residence
- Checking & Savings Accounts
- Home Furnishing, Appliances & Clothing
- Social Security, Veteran’s Benefits, Disability, Unemployment Benefits
- Pensions, 401(k), 403(b), IRA, Retirement Savings
- Unmatured Life Insurance Policies
- Trade / Professional Tools or Books
- Prescription Health Aids
- Funds from Award or Lawsuit
Non-Exempt Property in Bankruptcy
Certain non-exempt items in bankruptcy which may have to be given up by the debtor in Chapter 7 Liquidation to pay creditors include:
- Vacation Homes
- Property that is Owned & Paid Off
- Expensive Musical Instruments (unless the debtor is a professional musician)
- Collections of Stamps, Coins, Other Valuable Items
- Family Heirlooms
- Second Vehicle
Keeping Property in Chapter 13 Bankruptcy
When declaring Chapter 13 Bankruptcy, you are allowed to keep all of your property, granted that you make payments on all secured debts.
Bankruptcy law can be confusing and stressful, and we are here to help. Contact us online or call today at (734) 397-4540 to speak to our experienced bankruptcy attorneys and begin your fresh start free from crushing debt.