What is Exempt Property?

When a debtor is qualified to file Chapter 13 or Chapter 7 bankruptcy under the new bankruptcy law, his or her property and assets fall under the supervision of bankruptcy court. At the time of filing, Erie PA bankruptcy lawyers will classify your property as exempt or not exempt. The "exempt" status of an asset means that the debtor can keep that asset. 

Exempt property is defined differently from state to state but generally, property that can not be seized by creditors or bankruptcy court. Bankruptcy lawyers from Erie to know these statues of Pennsylvania. Most states exempt such things as health aids as contact lenses and hikers. Items of a personal nature, such as toothbrushes and hair dryers are considered as "personal effects" and are exempt in most states. Ordinary furniture and clothing are usually considered exempt, without any right attaching a value.

States may also set limits on the amount that is exempt from property that may be required. For example, the value of clothes, furniture or a vehicle exempted up to a limit. Any resemblance in these assets over the limit considered nonexempt and the court may request that this equity for the creditors in cash. 

In most countries, the following assets are typically considered exempt:

• Unpaid wages 

• Some of the equity in a home. 

• Some of the share capital of a vehicle. 

• Life insurance value 

• Tools of a business, usually up to a fixed amount 

• Reasonably necessary clothing 

• Reasonably necessary furniture 

• Household appliances 

• Jewelry, up to a set limit (usually a few hundred dollars) 

• Pensions 

• Public services

At the time a debtor when the point of filing bankruptcy, especially Chapter 7, most of their assets are either excluded or useless to the court. In this case, although the property may be nonexempt administrator can choose to "abandon" the property, which means that the debtor can keep it, if it is as collateral for a debt. Also, if property is specified by the administrator too heavy to sell, the trustee may abandon property. Bankruptcy lawyers from Erie can offer further advice if necessary.