Do you have concerns about what bankruptcy could mean for your personal property? Are fears regarding the loss of your important assets and things you need for daily life holding you back from making a decision that could positively impact your financial future? If so, you are not alone. Misconceptions and concerns about bankruptcy keep many Virginia consumers from exploring this potential option.
Thankfully, the intent of bankruptcy laws is to help an applicant overwhelmed by debt deal with certain types of balances. The point is not to leave a person penniless and without any property. If you file for Chapter 7 bankruptcy, which is a popular choice for many consumers, you may have to give up some property. However, it may surprise you learn that many types of property are exempt from liquidation.
The liquidation process
Chapter 7 bankruptcy is a popular choice because it is possible to complete this process in a matter of a few months. However, you will have to give up some of your property in order to proceed with this bankruptcy option. The proceeds of liquidating some of your assets will go toward paying some of your debts and meeting the demands of your creditors.
Non-exempt property includes things that are not always necessary for your daily life. These things may include a second home or vehicle, valuable musical instruments or valuable collections. You may also lose cash, investments and savings accounts you have.
Exempt property
While giving up some of your stuff may give you pause, it may help to know that many of the things you need and value are exempt, which means you get to keep them. You will not lose things such as appliances, your vehicle, jewelry and items you need for work. Bankruptcy exemptions also allow you to keep things such as some of the equity you have in your home, your pension and damages you won in a personal injury lawsuit.
Moving forward
It’s not always easy to make the decision to move forward with a bankruptcy filing. If you want to learn more about what this choice could mean for your personal property or how it can help you secure a better financial future, you may want to speak with an experienced bankruptcy attorney. Through this process, you may be able to discharge certain debts while still keeping many of the things that are important to you.