Can I Keep My Personal Belongings if I File for Bankruptcy?

couple packing boxes

You may understand that with a bankruptcy filing comes the halting of all foreclosure proceedings on your home. However, you may be unsure as to whether a debtor can still conduct collection activities for your personal belongings. Follow along to find out the possibility of keeping your personal belongings during your bankruptcy proceedings and how a proficient Rockland County bankruptcy attorney at The Law Offices of Allen A. Kolber, Esq. can help you in protecting them.

Is it possible to keep my personal belongings if I file for bankruptcy?

Your personal belongings may hold sentimental value alongside monetary value for you and your loved ones. So it is understandable that you do not want your bankruptcy trustee to liquidate these belongings to sell them and raise funds for your creditors.

Rest assured, your personal belongings may qualify as exemptions in your bankruptcy proceedings. Examples of such exemptions in New York State may include, but may not be limited to, the following:

  • Exemptions for cash of up to $6,000:
    • This may include cash that is in your bank accounts, savings bonds, tax refunds, and in your possession.
  • Exemptions for clothing, furnishing, and tools of the trade of up to $11,975:
    • This may include what you would pay in the open market rather than what you originally paid; also, this total limit may be reduced by the amount of cash that you are exempting from your $6,000 limit.
  • Exemptions for your retirement plans:
    • This may include your 401(k), 403(b), and IRA.
  • Exemptions for a personal injury claim of up to $9,000.
  • Exemptions for a car with up to $4,825 in equity.
  • Exemptions on anything else of up to $1,175 (i.e., The New York Wildcard Exemption).
  • Exemptions on all the money you received from disability insurance, life insurance, unemployment insurance, workers’ compensation, social security, veteran benefits, and more.

How can I protect my assets during bankruptcy?

Importantly, New York State offers a choice between the federal bankruptcy exemptions and its own New York bankruptcy exemptions. With this, you may be unable to select some exemptions from one and some exemptions from the other.

What’s more, you may be unable to exempt certain personal belongings if you are opting for New York State’s Homestead Exemption. This exemption may protect your family home, so long as you have partial ownership of the property; the property resides in New York States; and you reside on the property. Specifically in Rockland County, the maximum exemption you may be granted is $179,925.

In the end, the exemptions that you choose may be dependent on your specific financial situation. This is why you should not have to go through your bankruptcy proceedings alone. Instead, you should seek the assistance of a talented Rockland County bankruptcy attorney from The Law Offices of Allen A. Kolber, Esq. Contact our firm today.