Most creditors want consumers to believe that they will lose property if they file Chapter 7 bankruptcy because they believe it will deter consumers from seeking the debt relief they need. Bankruptcy myths float around the internet that claim anyone who files Chapter 7 bankruptcy will lose all of his or her property, will never own a home or a car again, will never be able to get credit again and will never recover from the horrible damage that a bankruptcy does to a credit rating.
The truth is that individuals who file Chapter 7 bankruptcy can own a home or a car in the future, they do qualify for credit after bankruptcy and their credit rating does improve as they pay their bills on time and manage their money wisely. Most importantly, most individuals who file for Chapter 7 relief do not lose any of their property. The misconception that if you file Chapter 7 you lose your property may come from the fact that Chapter 7 bankruptcies are referred to as “liquidations” because the trustee can seize non-exempt assets; however, in almost 99% of the Chapter 7 bankruptcies filed in New Jersey, all of the debtor’s property is protected by exemptions.
How Do You Protect Property When You File Chapter 7 Bankruptcy?
When you file Chapter 7, you are entitled to claim certain exemptions to protect specific pieces of your property. These bankruptcy exemptions are designed to protect property from the debtor’s creditors and the Chapter 7 trustee. Bankruptcy exemptions allow a debtor to claim the value in certain pieces of property as exempt up to the limits allowed by law. Therefore, if the property does not have equity above the exemption amount, the property cannot be used to pay the debtor’s creditors.
By using bankruptcy exemptions, the debtor is allowed to retain his or her property while discharging thousands of dollars in unsecured debt. This permits the debtor to receive a fresh start to being rebuilding his or her financial well-being while retaining the property he or she needs in order to provide for the welfare of the debtor and the debtor’s dependents. Because bankruptcy exemptions can be confusing and complicated, you should seek the advice of an experienced bankruptcy attorney to ensure that you are claiming the maximum exemptions allowed under the law to protect your property when you file Chapter 7 bankruptcy.
Contact an Experienced Mount Holly Bankruptcy Attorney
Personal Approach, Professional Service, Affordable Payment Plans
The Law Office of Travis J. Richards, LLC is a full-service Mount Holly bankruptcy law firm focused on Chapter 7 Bankruptcy, Chapter 13 Bankruptcy, debt consolidation, credit repair, tax liens, student loans and foreclosure. We represent clients in Burlington County and throughout South Jersey.
If you are experiencing financial problems due to debt, contact our office at 609-267-5297 to schedule your free consultation to discuss bankruptcy and non-bankruptcy alternatives. You may also use our convenient online contact form and one of our friendly, professional staff members will contact you to answer your bankruptcy questions and/or schedule a free consultation with Travis J. Richards.
Latest posts by Travis Richards (see all)
- Should I Use A Loan Consolidation To Solve My Debt Problem? - 08.20.2015
- Best Way to Pay Off Student Loans - 08.18.2015
- What Is Foreclosure? - 08.13.2015