Chapter 7 Bankruptcy is sometimes called "liquidation" bankruptcy -- it cancels

your debts, but you might have to let the bankruptcy court liquidate (sell) some of
your property for the benefit of your creditors. ("Chapter 7" refers to the chapter
of the federal Bankruptcy Code that contains the bankruptcy law.)

If you properly file a Chapter 7, you will no longer have to repay your debts and
your debts will be “discharged”. A discharge in bankruptcy means that you no
longer personally owe the debts.

Your goal in a Chapter 7 bankruptcy should be to “exempt” all of your assets so

that you can keep all of your property and still wipe out all of your debts.
However the U.S. Trustee will attempt to sell any assets you fail to properly
“exempt”. You can’t exempt property you don’t claim which is why you must list
all of your property.

In a Chapter 7, you are allowed to keep a certain amount of property that is called
exempted property. The bankruptcy court and creditors cannot take “exempted”
property from you unless they have a lien or mortgage on it.

For 2009 in Pennsylvania, you were allowed to keep $3,225 equity in a car,
$10,775 in personal property, $20,200 in your home, a 1,075 wildcard exemption
plus another $10,100 wildcard exemptions if the home exemption isn’t used.
These amounts increase every year for cost of living. You also have an almost
unlimited exemption for retirement funds ($1,095,000.00). It is very important
to be aware that these figures are doubled for married joint filers.

The principle of a Chapter 7 bankruptcy is that the Debtor is allowed to keep a

small amount of necessary exempted property to start over with and his creditors
keep the rest of the property. However, with the proper pre-bankruptcy planning,
it is rare that any property is handed over in a Chapter 7 case. Most people do not
have any assets to hand over after they are allowed to keep their exempted
property.
Dunne Law Offices, P.C.
1500 John F Kennedy Boulevard Suite #200
Philadelphia, PA 19102
(215) 854-6342
http://www.dunnelawoffice.com
http://www.dunnelawoffices.com
http://www.thephiladelphiabankruptcyattorney.com
http://www.bestphiladelphiabankruptcyattorney.com