Chapter 7 Liquidation: Which Assets Can Be Liquidated?
Nearly 9 million people have filed for Chapter 7 bankruptcy over the course of a twelve-year period. While filing for bankruptcy can be intimidating for obvious reasons, but filing is typically only the beginning of the process.
Once the process is started, there are lots of steps you need to follow. One of these steps is the liquidation of assets and you will have to determine what assets you are going to have to liquidate.
We have created a quick and easy guide on everything you need to know about filing for Chapter 7 liquidation and whether or not you can even liquidate certain assets.
What Assets Cannot Be Liquidated During Bankruptcy?
Let’s begin with the assets that you are not allowed to liquidate during Chapter 7 proceedings. These are known as exempt assets. Just because you are undergoing bankruptcy does not mean you have to give up and liquidate everything you own.
You do not have to liquidate your home, as you are entitled to keep it. Each state has a certain monetary limit of what you do not have to liquidate. For example, if you own a home that’s worth $1.5 million, you might be required to liquidate, while if your home is valued at $200,000, you most likely won’t have to liquidate.
You can generally keep up to a certain value for certain items. These items include cars, jewelry, furniture, and more. Check with your state’s requirements when it comes to the value that you are allowed to keep for specific items.
What Assets Can Be Liquidated During Bankruptcy?
Next up are the nonexempt assets. These are assets that you can liquidate during Chapter 7 bankruptcy.
Any property that is over that set monetary value can be liquidated. Any secondary properties or vehicles can be liquidated. If you own any valuable collections or jewelry, those can all be liquidated. ‘
If you have investments in the stock market, those are also eligible to be liquidated during Chapter 7 bankruptcy.
Consider Working with an Experienced Attorney
Even with this advice, navigating Chapter 7 bankruptcy on your own can be quite daunting and scary. But the good news is that you do not have to do it alone.
Consider consulting with a team of experienced Chapter 7 bankruptcy lawyers. They can handle the paperwork and legal requirements for you so that you don’t accidentally make a mistake and end up in more trouble.
Need to Know More About Chapter 7 Liquidation?
Filing for Chapter 7 bankruptcy can be a whirlwind, but it is far from being the end of the world. Arming yourself with all the knowledge you can about Chapter 7 liquidation, exempt assets, nonexempt assets, and secured debts will put you in a much better position than someone going into Chapter 7 without that knowledge.
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