What Happens to Your Property In Chapter 7 Bankruptcy

What Happens to My Property If I File For Chapter 7 Bankruptcy In My State?

It's important to have a good understanding of what will happen to your property if you file for Chapter 7 bankruptcy.
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Updated: 2021-12-20
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Can I Give Property Away To Friends Or Relatives To Avoid Losing It In Bankruptcy?
 
Can I Keep Property That I've I Pledged as Collateral For a Debt?

If you file for Chapter 7 bankruptcy you may or may not lose any property, depending on:

  • what and how much you own,
  • how you own it, and
  • what state you live in.

We offer several key articles to help you understand what happens to your property in Chapter 7 bankruptcy:

In a nutshell, in a Chapter 7 case, the trustee's job is to determine if you have any "non-exempt assets" that can be sold for the benefits of unsecured creditors. If not, your case is called a "no-asset" case.

Don't try to hide assets before or after you file for bankruptcy. The bankruptcy trustee can undo any transfers of property you do to family or friends if it you didn't receive full value in exchange. 


Jurisdictional relevance: ST

There are versions of this article for each State.

You may also be interested in:

  • Can I Give Property Away To Friends Or Relatives To Avoid Losing It In Bankruptcy?

    The short answer is “no.” Such transfers in the years before bankruptcy can be undone by the trustee. And if the court thinks you’re tying to hide assets they can deny your discharge.

  • Can I Keep Property That I've I Pledged as Collateral For a Debt?

    When you file, you'll be asked by the court to decide what you want to do about property you've pledged as collateral, and then you have 45 days to act on it. Your options include surrendering the property, "redeeming" the property by essentially buying it outright at it's current (reduced) market value, or "reaffirming" the debt via a contractual agreement to retain your personal liability and keep making payments, or in some cases, "ride through" - that is, keep making payments on the secured debt even though your personal liability has been wiped out.

  • Can I Keep My Car or Truck If I File For Chapter 7 Bankruptcy in My State?

    The answer is, it depends.. on a lot of things: Do you lease or own? If you own the car and are making payments on it, how much of the equity in the car is protected by exemptions allowed in New Hampshire? Most people who file for bankruptcy can end up keeping their car, or at least some kind of vehicle that can get them to work and back, but the answer depend on your particular circumstances.

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