Is it possible for me to file for Chapter 7 and keep my house and car?

Filing Chapter 7 bankruptcy may be an option for you. This type of bankruptcy is known as complete liquidation. The court will grant you a discharge for all of the debt you owe and list on the bankruptcy documents. However, the bankruptcy trustee also takes possession of your assets during the process. It is then that the bankruptcy trustee makes decisions about what types of property you are able to keep. There are two ways to keep property. The first is to ensure it is covered by a bankruptcy exemption. The second is to prove the asset is necessary to help you to have a strong financial start after your discharge.

Factors to Keep in Mind

When you file Chapter 7 bankruptcy, you can protect your vehicle and car in most cases. The key to doing so is to know the bankruptcy exemptions in your state.

• Bankruptcy exemptions for personal property often provide protection for one vehicle, up to a certain value. This value differs from state to state.
• Most states have a homestead exemption. This exemption protects the value of a home, up to a certain value.

If you have a loan on these types of property, it is critical that the equity (the value of the property minus any existing balance on the loan) is under the allowable limit. In addition, you must be up to date on this loan and the lender must reaffirm the loan with you. In most cases, this is not a problem, but to ensure that you are able to keep your house and car, discuss your options with your attorney.