This is the third part in a series of bankruptcy myths debunked. The first myth we debunked was that everyone will know when you declare bankruptcy. The second myth is that declaring bankruptcy will ruin your credit forever. The third myth we address is that when you declare bankruptcy you will lose everything you own. Perhaps you\u2019ve seen something on TV or in the movies that perpetuates this myth, such as someone sitting on the floor of a nearly empty house while workers haul away everything they own. Fortunately, this is far from the truth.<\/p>\n
Exempt property<\/b><\/p>\n
Chapter 7 bankruptcy is sometimes called \u201cliquidation bankruptcy.\u201d This sounds scary because the term “liquidation bankruptcy” seems to convey that a creditor can sell or liquidate some of your possessions. However, bankruptcy law provides various bankruptcy exemptions, covering most types of property, which allow you to retain that property from seizure or liquidation. In the vast majority of bankruptcy cases, people do not lose anything other than their debts. Examples of exempt property include necessary clothing, motor vehicles, household furniture, jewelry to a certain value, tools of your trade, your pension, welfare income, social security, and unemployment compensation. Other exempt property includes appliances, equity in your home, and monetary damages you received for personal injury.<\/p>\n
Protecting your rights and property<\/b><\/p>\n