If you are considering filing for bankruptcy, it is probably because you feel like you have no other viable options by which you can secure a better financial future. This process allows you an organized way through which you can discharge certain balances and reclaim your financial future. However, you may also have serious concerns about how this choice could affect your everyday life.
For example, will filing for bankruptcy cause you to lose your home? Will you have to give up certain assets in order to complete this process? It’s normal to have concerns about what this process could mean for you, but thankfully, there are protections in place that could be helpful to you. Bankruptcy law provides exemptions that will likely allow you to keep most of the things that are important to you.
Things you can keep
The intent of bankruptcy is to provide consumers a way to deal with their debt in an organized manner — not to leave you destitute and incapable of meeting your own basic needs. This is why there are exemptions available for people who file for Chapter 7 bankruptcy, which is liquidation bankruptcy. These exemptions will likely allow you to keep the following things:
- Some of the equity in your home
- Cars worth up to a certain amount
- Your pension
- Jewelry worth up to a certain dollar value
- Things you need for work
- Things you need for your home, such as appliances and furniture
- Wages you’ve already earned
- Compensation you received from a personal injury claim
- Any type of public assistance you currently receive
Things you cannot keep
Exemptions leave you with the ability to live a fairly normal life during the Chapter 7 bankruptcy process. However, there are things that you may have to relinquish in order to pay some of your debt. Examples of non-exempt assets include:
- Valuable collections, such as stamps
- Expensive musical instruments
- Cash, bank accounts and investments
- Second homes and extra vehicles
- Heirlooms and antiques
Where should you start?
Chapter 7 is a popular bankruptcy option because it allows a person to discharge balances that include credit card debt and medical bills. Typically, this process is complete within a matter of a few months. You may be certain that this is the best way forward for you, but there are strict eligibility requirements for Indiana consumers applying for this protection. An assessment of your case can help you see what you need to do to address your debt problem once and for all.