Chapter 7 Bankruptcy and Your Property

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Can I keep my property in Chapter 7 Bankruptcy?

One of the biggest myths about Chapter 7 bankruptcy is that you are going to lose all of your property.  In reality Texas is one of the friendliest states, allowing you to keep all of your property.  The legal term that provides this protection of your property is as an exemption.  As a resident of Texas you will have the option to use all of the exemptions under the Federal Statute and some special, state specific, exemptions that you may have heard of. 

Texas allows you to exempt the equity in your homestead.  The reality is that vast majority of all bankruptcy filers keep all their property in Texas.  Although the property is exempt, if you want to keep the property and you still owe money on it, you will have to continue to pay for it.  Chapter 7 Bankruptcy provides you the means to reaffirm the debt and continue making payments on it.  At the completion of the payment plan, the title, or lien, will be released and you will own the property free and clear.   If you are interested to see if you will be able to keep all your property and how exemptions affect you, please complete our online evaluation form.