File Bankruptcy And Keep Your Stuff

When someone is considering filing for bankruptcy one of the first questions they have is “Can I keep my stuff”? This is an important question that must be discussed with the expertise of their bankruptcy attorney since this can vary from state to state depending on the exemption laws that apply. Exemptions are basically provisions in federal bankruptcy laws as well as state regulations that allow a debtor to protect assets from being included in their Chapter 7 bankruptcy filing. Assets that can be protected include property such as their home, their car, tools of the trade required for one’s business, and their 401(k). In addition, veteran’s benefits, unemployment compensation, worker’s compensation, group life policies, and accident or disability benefits may also be exempt.

The bankruptcy laws can be complicated but an experienced bankruptcy attorney in your area will know the state’s exemption laws as well as federal exemption allowances and be able to choose accordingly to allow the debtor to keep the maximum amount of property and possessions. If the debtor has a lien on their property and they are current on the payments and can afford to continue to make the payments, then during the bankruptcy the attorney can have the debtor reaffirm the debt and they will be able to retain the property. In our current economy, the last thing a trustee wants to do is take someone’s property if it cannot be liquidated easily. Many times the cost and time of selling the property will outweigh the amount of money they would get to divide among the creditors. 

The bankruptcy court trustee’s job is to make sure that the creditors receive as much money as possible from the bankruptcy. However, a bankruptcy attorney’s job is to make sure that the debtor keeps as much of their assets as possible. This is why it is imperative to seek the advice of an experienced bankruptcy attorney. Many people have realized that filing for bankruptcy may be the most responsible way to alleviate debt without losing everything they own.