People facing serious financial struggles can often benefit from bankruptcy. They may be hesitant to file for bankruptcy due to several concerns.
A common concern is what will happen to their assets and property during a bankruptcy. The following is a brief explanation regarding whether your assets may be at risk if you file a bankruptcy case.
Exemptions in Chapter 7 Bankruptcy
Simply put, Chapter 7 bankruptcy discharges many of your debts without requiring a repayment plan. However, before a discharge takes place, the bankruptcy court will appoint a trustee to your case.
The trustee can require the filer to turn over certain property and assets in order to pay as much as possible to the creditors. Many people may believe the trustee will take everything and leave them without a home or anything in their accounts.
The law protects bankruptcy filers by providing numerous exemptions (“protections”) for specific types of assets and property. The result is that most people will retain their assets in a Chapter 7 case.
Some of the most common exemptions under Texas law include the following:
- Unlimited Homestead Exemption - If a filer lives in a rural area, any residence on 100 acres or less can be protected. If a filer lives in a town or city area, a home will be protected if it is on 10 acres or less.
- Motor Vehicles – The general rule is that a filer can protect one motor vehicle for each member of the household who has a driver’s license. There are certain situations in which a vehicle for an unlicensed household member may also be exempted.
- Personal Property - Texas law provides for protection of many types of personal property including Bibles and books, pets and farm animals, two firearms, food, clothing, medical equipment, household furnishings, jewelry, family heirlooms, sports equipment, and more. The total a household can exempt is $100,000.00 of personal property.
- Retirement Accounts – Filers can protect most types of pensions, retirement savings accounts, and insurance policies.
The exemptions in Texas are some of the most generous in the country and many bankruptcy filers are able to protect all of their assets and property by correctly applying these exemptions.
Contact an Arlington Bankruptcy Attorney for a Free Consultation Today
An experienced Texas bankruptcy lawyer can help you apply bankruptcy exemptions in the best way possible and can help address any concerns you have about the bankruptcy process.
Please call the Law Office of Marilyn D. Garner at (817) 505-1499 for a free consultation to discuss how bankruptcy may help you.