Will I Be Able to Keep My Property in Bankruptcy?

Chapter 7 Bankruptcy Property Possession

Property possession is an alarming thought for people who file for Chapter 7 bankruptcy. Debtors are often warned that they can lose property, like their homes and cars, after filing for bankruptcy. While it is true that a trustee can claim a debtor’s non-exempt property and sell it to pay back creditors, in most cases debtors do not lose any of their property. There are safeguard provisions that allow debtors to exempt, or keep, certain property from the bankruptcy estate. These exemptions are largely far-reaching and many debtors are able to use them in such a way that there is no need to pay in additional money to the trustee. Let’s take a closer look at what kind of property is exempt and what the process involves.

In Minnesota, you may choose the state or federal exemption scheme. Minnesota residents can choose which exemption scheme is best for them. Deciding how to best protect your property using the exemptions available to you is a complicated and detailed process. One should consult a bankruptcy lawyer in order to ensure they have protected their assets in the best way. Below is a summary of some of the common Minnesota and federal property exemptions.

Common Minnesota and Federal Property Exemptions

Final Thoughts

The vast majority of people who do not have a large amount of equity in their home pay nothing at all into the bankruptcy estate. However, how much property you can exempt differs from state to state, so it’s worth looking into your state’s exemption laws and consulting with a bankruptcy lawyer in your state to get a more detailed look at your situation.