You may have been told that you can lose some property if you file for a Chapter 7 bankruptcy. This information may have dissuaded you from seeking relief. However, it is important for you and other Florida residents to understand exempt and non-exempt bankruptcy assets, so you can make an informed decision.
According to FindLaw, non-exempt property may be sold by a bankruptcy trustee to repay creditors before you receive a discharge of the rest of your eligible debt. What exactly is non-exempt property, you may wonder? This includes assets the court does not consider necessary for modern life and your continued employment. Non-exempt assets can include a second home or recreational vehicles, collections and jewelry over a certain value, investments and stocks and bonds.
Bankruptcy law recognizes that people need some possessions for their comfort and well-being, as well as to allow them to continue to work. Property that is usually considered exempt from liquidation in a bankruptcy usually includes the following:
- Your primary vehicle
- Clothing and jewelry up to a certain value
- Tools of your trade
- Furniture, appliances and household goods
- Public benefits, pensions and personal injury damages
It can be frightening to think that you may lose some possessions when you file for bankruptcy. However, learning about exempt assets, particularly finding out that you may end up keeping most of your possessions, may be reassuring. Each person's situation is unique, as well as the circumstances surrounding a personal bankruptcy. Therefore, the information in this blog is meant to educate you, but it should not replace the advice of a lawyer.