Life can deliver some not-so-pleasant surprises, and those surprises can put you behind on your bills. When you need relief, bankruptcy can be an option. With Chapter 7 bankruptcy, you aren't required to keep repaying most of your debts, but you'll pay a price for that, and that price is asset liquidation.

At the Craig Black Law Firm, your case is the top priority. I personally work with each client, answering questions and advising you on how to proceed. If you're considering bankruptcy, get in touch with me by calling 678-888-1778 or filling out this confidential online form.

What Is Liquidation Bankruptcy?

When you're facing bankruptcy, you have some decisions to make. Filing Chapter 13 means creating a repayment plan. With Chapter 7, though, most of your debts are wiped out in exchange for selling off all your nonexempt assets to help repay those creditors.

Selling off assets is known as “liquidation,” which is why Chapter 7 bankruptcy is also called liquidation bankruptcy. The courts will direct which assets you'll need to liquidate, but there are precedents for those judgments. Certain assets have been historically labeled exempt, and those assets will usually remain in your possession.

Exempt Assets in Chapter 7

When you file for Chapter 7 bankruptcy, you'll be required to provide a catalog of assets, both major and minor. Your assets fall into three categories:

·        Personal property: This refers to the items around your house, including clothing and furniture, as well as any vehicles you own.

·        Real property: Think of this as real estate. It includes any homes you own, along with outbuildings like barns and storage facilities.

·        Intangible property: You likely have assets that aren't tangible, such as retirement savings and child support payments. You'll need to list these too.

It's up to the courts to decide whether an item should be sold to pay off your creditors in a Chapter 7 bankruptcy. Some items are exempt, which means you'll get to keep them, but the judge will sort through the list and rule on which assets stay and which assets go.

Although it varies by jurisdiction, here are some items that are typically exempt from a Chapter 7 bankruptcy liquidation:

·        Child support and alimony.

·        Homes with equity below a qualifying amount.

·        Vehicles with equity below a qualifying amount.

·        Clothing and jewelry up to a certain value.

·        Household goods up to a certain value.

·        Life insurance proceeds.

·        Government benefits, including those that come from Social Security, unemployment, public assistance, and disability. Veteran's benefits are also commonly exempt.

·        Retirement account proceeds up to a qualifying amount.

Exemptions allow you to keep some of the assets you need to live and work so that you can continue to make a living. The goal of bankruptcy is to give debtors a fresh start, allowing them to bring in money to contribute to the economy moving forward.

How the Craig Black Law Firm Can Help

The Craig Black Law Firm believes each case is unique, and I work hard to provide personalized service. When you call 678-888-1778, I'm the one who picks up the phone and listens to your concerns. I regularly represent clients going through Chapter 7 bankruptcy and can help you determine which assets you'll be able to keep. If you're considering a bankruptcy filing, call me or complete this online form, and I'll be in touch.