If I file for bankruptcy, what will I lose?
If you file for bankruptcy what are you going to lose? Usually you won’t lose anything, because each state has a list of exemptions, and that just means that there’s a list of property that is exempt from creditors. They can’t take it from you [just] because you owe them money. And we can usually fit your bankruptcy within the state exemptions.
Now you have two different chapters that you can choose: Chapter 7 and Chapter 13. That term’s not as mysterious as it may sound. A Chapter just means it’s a chapter in the bankruptcy code, which is like a book – the law of bankruptcy.
Chapter 7 may be a little more problematic in keeping property, but we can advise you about that and the exemptions will usually cover the things that you want to keep.
Sometimes you may not want to keep your property because you might want to be free of the debt that secures that property. And in Chapter 13, it’s designed to help you keep your property, because it’s a reorganization and repayment of debt that fits into a payment that you can afford.
So losing your property shouldn’t be a big concern, but it is something that you should talk to us about just to see if it might be a problem for you.
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