What Property Can I Keep In A Chapter 7 Bankrupcty?
Once you file for bankruptcy protection, all your property is considered property of the estate. However, the Bankruptcy Code provide debtors with exemptions from the bankruptcy estate that allows for debtors to obtain all the benefits of a "fresh start." In most Chapter 7 cases debtors are, through the use of the exemption process, able to keep all their property. Additionally, in general, when debtors remain current on their secured property (cars, homes, etc.), they are able keep their property. For vehicle loans, reaffirmation agreements may be required to keep the property. However, when payments are not made, the lender can seek relief from bankruptcy’s automatic stay to retain possession of the vehicle.
People who file bankruptcy are often able to keep three kinds of property: A. exempt property, B. Property that is fully encumbered with debt, and C. Property that has no value or can not be sold. Even though ultimately a debtor in bankruptcy will be able to keep this property, the debtor should not be sell anything until the case is closed or their attorney tells them that you can sell it. Exempt Property. The property that a debtor is allowed to keep in a bankruptcy is usually the same property that a creditor could not take even if the debtor had not filed a bankruptcy. It is called exempt property. Each state has different exemption laws and the Bankruptcy Code has exemption laws that also can apply. Some States, like California have different sets of exemption laws and the debtor can choose the exemption plan that works best. Go here to see a chart of California exemptions. (faq-property-CAexempt) Go here to see a chart of Wyoming exemptions. (faq-property-WY-exempt) Fully Encumbe
