Your Personal Property
Once the bankruptcy is filed, all the property of the debtor at the time of the filing and
certain other property to be received in the future, becomes the property of the
bankruptcy estate. This means that the bankruptcy trustee will take control of
this property for purposes of satisfying the creditors. HOWEVER, there is certain property
which is either excluded or exempt and the debtor will be able to keep it.
Property or asset exemption are determined based upon your situation, income and the laws
of your state. The best way to determine which property to keep requires a detailed
analysis of your situation. You need a good lawyer.
As for real property in many states, dependent upon which exemption scheme is selected and
your circumstances, you may exempt up to $100,000 in equity. When calculating your equity
you should use a value that is based upon a forced
liquidation as opposed to the best selling conditions to arrive at a value for your
home. Once you determine this value, subtract the amount owed plus selling and transfer
costs from the value to calculate the equity. As for personal property, in
California, you are permitted exemptions for a variety of personal property. This
includes, automobiles,household furnishings and personal effects, jewelry, tools of the
trade, retirement plans, unmatured life insurance, personal injury awards, earnings,
animals and some other miscellaneous property. The value of each exemption and which
exemptions can be used are determined by the statutory exemption scheme is selected.
(State laws vary)
Disclaimer:
This information deals with Chapter 7 consumer bankruptcy. Each state has its own
bankruptcy laws, so you need to check with your state for details. Information dealing
with Chapter 13 bankruptcy and consumer debt restructuring is not discussed in the above
FAQs. The information contained in the following FAQs is provided for general information
purposes only and is not intended to be a legal opinion nor legal advice nor is it
intended to be a complete discussion of all the issues related to the area of Chapter 7
consumer bankruptcy. Every individual's factual situation is different and you should seek
independent legal advice regarding specific information.
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Chapter 7 Bankruptcy
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