You may be able to keep property that is slightly over the exemption amount claims Kinsman bankruptcy attorney. Remember that when a Chapter 7 trustee takes the property, they have to sell it, liquidate it, pay you your exemption amount and then use the rest of the proceeds towards administrative expenses and then the balance to creditors on a pro rata share. If you have an item that is significantly over the exemption amount, then I may recommend that you do not file Chapter 7 bankruptcy. The one exception would be is if you knew that that property is subject to being taken but you are willing to surrender it in exchange for a fresh start.
Picture a situation where someone has over $150,000.00 worth of debt but they have a vehicle worth $9,000.00 that’s paid in full. That individual debtor might say it’s worth it to give up the car in exchange for a $2,400.00 payment from the trustee and eliminate the rest of all of that debt. However, the debtor doesn’t have to surrender the vehicle. The debtor can make arrangements prior to filing bankruptcy, in other words pre-bankruptcy planning, so that they’ll be able to keep the vehicle or exchange it for another vehicle that does not have significant equity as long as the conduct of the debtor is not fraudulent, they are doing nothing wrong and the trustee will not have any objection to the transfer.
If you definitely have equity in property and you definitely have equity in vehicles and bank accounts, then the real option for you is a Chapter 13 repayment plan under the Bankruptcy Code. Chapter 13 is commonly known as Home Saver Bankruptcy where you’re trying to repay mortgage arrears over time and save a property from foreclosure.
Here is how it typically works in a bankruptcy Chapter 13 case. Let’s take the picture of a homeowner who has fallen behind on the mortgage because they either lost their job temporarily or they became ill or for some other reason they were not able to make their regular mortgage payment. Circumstances have changed now and they do have the ability to not only make the regular mortgage payment again, but they have money that they can put away towards the mortgage arrearage and repay it. They have tried to contact their mortgage company but the mortgage company wants one lump sum payment to catch up or they’re threatening to foreclose and sell the house.