One of the most distressing things about Chapter 7 is the idea that you might have to get rid of your assets and other possessions. After all, Chapter 7 is called "liquidation" for a reason -- you'll need to sell many of your assets to and pay back your creditors with the proceeds. However, it's vital to remember that you won't need to sell all of your assets.
Indeed, the process is not meant to leave you on the street without the clothes on your back or the things you need to survive. Chapter 7 liquidation filers will benefit from various exemptions. Barring certain limitations for items of high value, you be able to keep the following in your bankruptcy process:
- Your primary vehicle
- A certain amount of the equity in your home
- Your clothing
- Certain jewelry items
- Home appliances
- Pension and retirement funds
- Tools you need for your profession
- Reasonable household furniture and goods
- Part of the unpaid wages you're owed.
- Public benefits like Social Security payments, unemployment compensation and welfare assistance, including this money that may have accumulated in your bank account.
- Damages related to personal injury payments.
Part of a bankruptcy attorney's job is to help get as much of your assets exempt from Chapter 7 proceedings as possible. Therefore, if losing your assets is one of your concerns about bankruptcy, make sure you speak with a bankruptcy lawyer about what assets you may or may not be able to keep in this legal process. That could give you some idea about whether Chapter 7 could be right for you and your financial situation.