What Assets Can I Keep in a Chapter 7 Bankruptcy?

If debts are piling up and you’ve exhausted all other options, you may be considering filing for bankruptcy. Fortunately, Chapter 7 bankruptcy, also known as the liquidation bankruptcy, is far less scary than many clients initially think. To further ease your worries, our experienced Rockland County bankruptcy attorney has compiled a short list of various assets you may keep when filing for Chapter 7 bankruptcy.

  • Your home: Filing Chapter 7 bankruptcy issues an automatic stay, which can prevent a foreclosure on your home. As long as your home is valued less than the full amount of your mortgage and you meet all requirements of the Chapter 7 Bankruptcy Court, you should be able to keep your home.
  • Life insurance policies: Under most circumstances, you will not lose your life insurance policy, however, if you have a whole life insurance policy that functions as an investment vehicle, it may not be exempt from the bankruptcy.
  • Alimony and Child Support: If you receive alimony or child support payments from a former spouse or partner, you can feel confident knowing these payments are completely exempt from bankruptcy cases, and you should continue receiving them as normal.
  • Workers’ Compensation/Disability Benefits: These types of payments are classified as loss of past and future earnings, which means they are exempt from Chapter 7 bankruptcy as well.
  • Your bank account: You may keep up to $11,000 in your bank account that you can use at your will.
  • Your pension: Pensions, retirement accounts, and IRAs are all exempt from bankruptcy cases, meaning you can keep as many funds as you’d like in those accounts. You should also note that 401(k) Plans, IRA’s and pension plans, up to $1 million are exempt from Chapter 7 bankruptcy.
  • Your car: As long as your car (or another automobile) is worth less than $4,200, you may keep it after filing Chapter 7 bankruptcy.
  • Possessions: When filing Chapter 7 bankruptcy, you should note that you may keep up to $10,000 in furniture, clothing, and other household goods. (Wedding rings and televisions are also exempt from Chapter 7 bankruptcy).
  • Your wages: While under the protection of the Bankruptcy Court, you will not have to worry about having your wages garnished.

If you have any additional questions about the Chapter 7 bankruptcy process ahead, please do not hesitate to give our knowledgeable Rockland County bankruptcy attorney a call today.

Contact our experienced New York firm

The Law Offices of Allen A. Kolber, Esq. effectively represents clients facing Bankruptcy in Rockland County and all of New York State. Our firm understands the stress one can feel when facing a difficult financial future. Our compassionate staff will work to ease your fears and help you make a new start. If you need quality legal support, contact The Law Offices of Allen A. Kolber, Esq.