Our office continues to operate during our regular business hours, which are 8:30 am - 5:30 pm, Monday through Friday, but you can call the office 24 hours a day. We continue to follow all recommendations and requirements of the State of Emergency Stay at Home Order. Consultations are available via telephone or by video conference. The safety of our clients and employees is of the utmost importance and, therefore, in-person meetings are not available at this time except for emergencies or absolutely essential legal services.

Will I Lose Everything When Filing For Bankruptcy?

Charlotte Bankruptcy attorney Bryan W. Stone answers the question: “Can I keep my car if I file bankruptcy?”


It is one of the most common questions for anyone contemplating filing for bankruptcy: Will creditors take everything I have? The answer to the question is almost always a resounding, “No!” The reason is that things like clothing, household furnishings and other small personal items often have little value and state exemptions allow debtors to hold onto many if not most of their paid-for personal items.


Empty House Charlotte Bankruptcy Attorney North Carolina Chapter 13 LawyerTo break this question down a bit further, let us start by clarifying that in a Chapter 13 bankruptcy none of your personal possessions will have to be sold off. You will simply need to catalog the value of the items you have and how much debt is owed and then create a workable repayment plan. This allows you to keep everything you currently own while making payments over a span of years.


In a Chapter 7 bankruptcy there is a possibility that some valuable assets might be sold by a bankruptcy trustee, but even that is very rare. That’s because most personal items like clothing, dishes, furniture and even jewelry often have very little resale value. No bankruptcy trustee is going to empty out a person’s closet and take it down to the local consignment store to score a few bucks.


Beyond the fact that most personal items often lack substantial value, it is important to note that each state has its own specific exemptions for property that bankruptcy filers are allowed to keep. Here in North Carolina the list of exemptions is pretty long, which means those filing for bankruptcy don’t have to worry about having all their worldly positions taken from them.


One important example of an exemption in North Carolina is the vehicle exemption. The law says that bankruptcy filers can exempt up to $3,500 in one motor vehicle, though this exemption (and all the others) do not apply if you purchased the item within 90 days of filing for bankruptcy. This means that if your car is worth $3,500 or less, there’s no need to worry about having it taken; you are allowed to keep it.


The law also includes exemptions for up to $5,000 in personal household items like clothing and furnishings as well as an additional $1,000 per dependent. Personal injury and wrongful death payments are exempt as are college savings accounts up to $25,000, personal health aids, professional tools and books and even burial plots.


In addition to these state specific exemptions, everyone can hold onto things like retirement accounts, life insurance and child support payments. Though bankruptcy is still a difficult process, it can be good to know that you don’t need to fear having some bankruptcy trustee literally strip you of the clothes on your back.


If you find yourself needing the services of a Charlotte, North Carolina bankruptcy attorney, please call the skilled lawyers at Arnold & Smith, PLLC today at (704) 370-2828 or find more resources here. As professionals who are experienced in the bankruptcy arena, our attorneys will provide you with the best advice for your particular situation.


About The Author: 

Bryan 1  Bryan Stone is a Partner with Arnold & Smith, PLLC where he focuses his practice on all aspects of bankruptcy, including: Chapter 7, Chapter 11, Chapter 13, home loan modifications and landlord tenant issues.  Originally from Macon Georgia, Mr. Stone attended the University of Georgia for a BBA in Banking and Finance and went on to Wake Forest to earn his law degree.  After law school Mr. Stone relocated to Charlotte where he has become quite involved in many local organizations.  He is currently the Chair of “Bravo!” the young professionals organization of Opera Carolina, he also founded the UGA Alumni Association of Charlotte.  In his spare time he enjoys perfecting his BBQ skills for the annual “Q-City BBQ Championships” and playing softball with the Mecklenburg County Bar Softball League.



“What can creditors take in a bankruptcy?,” by Justin Harelik, published at BankRate.com.



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