Property & Exemptions

Learn how to protect your property using exemptions and what you should know about buying property after filing.

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Property & Exemptions

Exemptions are laws that protect your property. They’re why more than 95% of all Chapter 7 filers, including most Upsolve users, keep all of their belongings! Plus, after getting their discharge, they are in a better position to qualify for a mortgage and buy a house than before.

This page is your home base for learning about how to keep your property during bankruptcy and how bankruptcy affects buying property after filing.

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Guide To Bankruptcy Exemptions: What Can You Keep When You File Chapter 7?

Written by Attorney Andrea Wimmer. Legally reviewed by Jonathan Petts
Updated September 16, 2025

Filing for Chapter 7 bankruptcy doesn’t mean losing everything. In fact, most people who file get to keep all of their property, including their home, car, clothes, and everyday household items. That’s because bankruptcy laws include exemptions, which are legal protections for the things you need to live and work.These exemptions exist to help you get a real fresh start. This guide breaks down how bankruptcy exemptions work in Chapter 7, what property they cover, and how to make sure you claim them properly. Whether you're using state or federal exemptions, understanding these protections can give you peace of mind and help you move forward.

Written by Attorney Eva Bacevice. Legally reviewed by Jonathan Petts
Updated September 1, 2025

Many people successfully get a mortgage after filing Chapter 7 bankruptcy. Lenders have their own requirements and waiting periods but buying a home after bankruptcy is possible. The real question here is: When will you be able to qualify for a mortgage? This will vary based on the type of loan you pursue. Many Chapter 7 filers become eligible for a home loan 1–4 years after they receive their bankruptcy discharge, depending on the type of mortgage they apply for.

Written by Attorney Andrea Wimmer. Legally reviewed by Jonathan Petts
Updated August 21, 2025

Most people who file Chapter 7 bankruptcy don’t lose any of their money or property because exemptions protect the things they need to live. This article explains how to find out if any of your assets are at risk, both before and after you file, including what to look for on your bankruptcy forms and during your 341 meeting. It also covers what happens if you receive property after filing—like a tax refund or inheritance—and how that can affect your case. You’ll also learn what it means if the trustee asks you to update your exemptions, and how to tell if your case is considered a no-asset case.

Written by Attorney Andrea Wimmer. Legally reviewed by Jonathan Petts
Updated August 25, 2025

Filing for bankruptcy doesn’t cancel your lease or force you to move. If you’re current on rent, you can keep your lease by continuing to pay on time. If you’re behind, the automatic stay temporarily prevents eviction, but you’ll need to catch up on rent to stay. Bankruptcy can wipe out back rent owed before filing, but you’re still responsible for rent after filing. If there’s already an eviction judgment, you’ll need to meet certain requirements to stop the eviction.

Written by Mae Koppes. Legally reviewed by Jonathan Petts
Updated September 1, 2025

Most people who file Chapter 7 bankruptcy can keep their checking account, as long as the money in it is protected by a bankruptcy exemption. Exemptions are legal protections that let you keep certain property, including some or all of your bank account balance. Timing and the source of your funds can also affect whether the money is protected. If you owe money to your bank or credit union, or have a large balance, it’s important to understand how that could affect your account before you file.

Written by Attorney Andrea Wimmer. Legally reviewed by Jonathan Petts
Updated August 26, 2025

Many people who file Chapter 7 or Chapter 13 bankruptcy can keep their home, but it depends on several factors. To keep your home in Chapter 7, you’ll need to be up to date on your mortgage payments and your home equity must be covered by the homestead exemption in your state. In Chapter 13, you can catch up on missed mortgage payments through a repayment plan, which can help you keep your home and avoid foreclosure.

Written by Attorney Andrea Wimmer. Legally reviewed by Jonathan Petts
Updated August 29, 2025

There are nine community property states. Alaska also allows married couples to opt into a community property arrangement. Community property states typically consider any property acquired during a marriage to be jointly owned by both spouses, regardless of who made the purchase or what the title says. This is important in bankruptcy because creditors may be able to access community property if one spouse files bankruptcy.

Written by Jonathan Petts. Legally reviewed by Ben Jackson
Updated August 13, 2025

If you've deposited funds into a 529 College Savings Plan for your child, you probably want to know how filing bankrtupcy will affect them. Whether the funds are protected will depend on how long ago you deposited them.

Written by Jonathan Petts. Legally reviewed by Ben Jackson
Updated August 26, 2025

Retirement accounts are almost always protected in a bankruptcy case. If you're considering filing, it’s best to keep your retirement assets where they are. Unless you can fully pay off all of your debts, taking money out of your retirement accounts to keep up usually only prolongs the inevitable.

Written by the Upsolve Team. Legally reviewed by Lawyer John Coble
Updated May 4, 2022

Alimony impacts your bankruptcy case differently if you’re paying alimony than if you’re receiving alimony. If you pay alimony, you must list it on your Schedule J as an expense. You must also usually continue to make payments while your case is pending and after you receive your bankruptcy discharge. Bankruptcy doesn’t eliminate your obligation to pay court-ordered alimony. If you receive alimony, you must list the amount as income on Schedule I and on the means test calculation form.

Written by Curtis Lee, JD. Legally reviewed by Jonathan Petts
Updated August 26, 2025

If you bring a lawsuit or have the right to bring one against someone for a personal injury case, that's considered an asset during your bankruptcy case. Just like other assets, this may be protected by a bankruptcy exemption. If the potential personal injury reward isn't protected or fully protected by an exemption, the nonexempt portion of the award can be used to pay off your creditors as part of your bankruptcy case.

Written by Jonathan Petts. Legally reviewed by Ben Jackson
Updated September 1, 2025

Whether or not you can keep your personal injury settlement award when you file for bankruptcy depends on a number of different factors.

Written by the Upsolve Team. Legally reviewed by Attorney Paige Hooper
Updated September 1, 2025

Your equity in a house or car (the dollar value that belongs to you, not the lender) is the current value of the property minus the amount you still owe on it. When you file bankruptcy, exemptions protect the equity you have in certain assets.

Written by Jonathan Petts. Legally reviewed by Ben Jackson
Updated August 29, 2025

Credit unions operate differently than banks in Chapter 7 bankruptcy, and those differences can create extra challenges. Because of cross-collateralization, a car loan with a credit union may also secure unrelated debts like credit cards, making it harder to fully discharge those debts without giving up the car. Credit unions can also use set-offs to pull money directly from your accounts or freeze them once you file, and in some cases they may even revoke your membership. To protect yourself, it’s often wise to move direct deposits and savings to a regular bank before filing and check whether your credit union loans are cross-collateralized.

Written by Curtis Lee, JD. Legally reviewed by Jonathan Petts
Updated September 2, 2025

In Chapter 7 bankruptcy, there are exemptions to protect some of the equity you have in your assets, like a home, car, or household items. If the exemption for a certain item doesn’t cover all the equity you have in it, you have non-exempt equity. Depending on how much non-exempt you have, the bankruptcy trustee may liquidate (sell) the item and give the proceeds to your creditors.

Written by Ben Jackson. Legally reviewed by Jonathan Petts
Updated August 13, 2025

Exemptions help you protect your property and assets in bankruptcy. There are both state and federal exemptions, but Arizona has opted out of the federal bankruptcy exemptions. That means, if you’ve lived in Arizona for at least two years when you file your bankruptcy case, you have to use Arizona's exemption laws. Arizona has a generous homestead exemption of $250,000. The motor vehicle exemption is $15,000 for single filers (or $25,000 if you or a dependent is disabled). Arizona does not have a wildcard exemption.

Written by Attorney Eva Bacevice. Legally reviewed by Attorney Andrea Wimmer
Updated September 2, 2025

Before filing Chapter 7 bankruptcy, you can spend money on necessary expenses like rent, utilities, groceries, and medical bills. However, you should avoid making any large or unusual purchases or paying off debts to friends or family, as this could raise red flags with the bankruptcy court. Spending money on luxury items or transferring assets before filing could be seen as fraudulent and might affect your case.

Written by Ben Jackson. Legally reviewed by Attorney Andrea Wimmer
Updated August 11, 2025

Some states permit filers to choose between a set of federal bankruptcy exemptions and the state exemption system. However, California isn’t one of them. California is called an “opt-out” state, which means federal bankruptcy exemptions are not available to filers in the state. Californians filing bankruptcy have to use California exemption law.

Written by Ben Jackson. Legally reviewed by Attorney Andrea Wimmer
Updated September 16, 2025

If you’ve been a Florida resident for at least two years and you file Chapter 7 bankruptcy, you’ll need to use the state’s exemptions to protect your property. Exemptions are laws that outline how much of different kinds of property are protected when you file a bankruptcy case. Most filers see that all their property is protected. In Florida, the homestead exemption protects all the equity you have in your home, given you meet a few criteria. The motor vehicle exemption is $5,000, and if you don’t use the homestead exemption, you can apply the $4,000 wildcard exemption to your vehicle (or any other property) as well.

Written by the Upsolve Team. Legally reviewed by Attorney Andrea Wimmer
Updated September 9, 2025

Texas has more generous bankruptcy exemptions than many other states. It also allows bankruptcy filers to choose whether they want to use the Texas state bankruptcy exemptions or the federal bankruptcy exemptions. In many cases, the state exemptions are more beneficial to bankruptcy filers who own a home or car. But unlike the federal exemptions, Texas doesn’t offer a wildcard exemption to protect personal property of your choosing.

Written by the Upsolve Team. Legally reviewed by Attorney Andrea Wimmer
Updated September 9, 2025

If you’ve been an Illinois resident for at least two years, you’ll need to use the state’s exemptions if you file Chapter 7 bankruptcy. Exemptions help you protect important property, from your household furnishings and clothing to your car and retirement accounts. The homestead exemption in Illinois is $15,000 (or $30,000 if you’re married and filing jointly). The motor vehicle exemption is $2,400. Illinois also offers a $4,000 wildcard exemption.

Written by Ben Jackson. Legally reviewed by Attorney Andrea Wimmer
Updated September 2, 2025

Bankruptcy exemptions are rules that allow people who file for bankruptcy to keep certain important items instead of having to sell them to repay their debts. If you’re filing bankruptcy in Ohio, you must use the state’s exemptions to protect your property. Ohio has a homestead exemption of up to $182,625 for individual filers, a $5,025 motor vehicle exemption, and a $1,675 wildcard exemption. It also has exemptions for personal property and money benefits.

Written by Mae Koppes. Legally reviewed by Attorney Andrea Wimmer
Updated September 16, 2025

If you’ve lived in Michigan for at least two years when you file bankruptcy, you can choose between the state’s exemptions or the federal bankruptcy exemptions. Both have the same aim — to help you protect your property. Michigan has a higher homestead exemption than the federal government ($46,125 vs. $31,575). But if you aren’t a homeowner, the federal exemptions for personal property, including your vehicle, are more generous.

Written by Ben Jackson. Legally reviewed by Attorney Andrea Wimmer
Updated September 1, 2025

Virginia bankruptcy exemptions let you keep certain property—like your home, car, and household items—when you file for Chapter 7 bankruptcy. These exemptions are grouped by category and have dollar limits that protect the value of specific types of property, including personal items, wages, and public benefits. Unlike some states, Virginia does not let you choose between state and federal bankruptcy exemptions—you must use the Virginia list. If your property falls within these exemption limits, you can likely keep it, even while clearing away your unsecured debts. Understanding how exemptions work can help you protect the things that matter most as you get a fresh financial start.

Written by Attorney Karra Kingston. Legally reviewed by Jonathan Petts
Updated August 7, 2025

Bankruptcy exemptions are laws that allow people filing for bankruptcy to retain their essential belongings, instead of losing everything to pay off debts. These laws vary from state to state. If you have lived in New York for at least two years and you file for Chapter 7 bankruptcy, you will use the state's exemptions to protect your personal property, like your car, from being seized. The homestead exemption in New York varies based on where your residence is located. The motor vehicle exemption is $4,825 (or $11,975 if your car is equipped for a disabled person). New York also has a $1,100 wildcard exemption.

Written by Attorney Eva Bacevice. Legally reviewed by Jonathan Petts
Updated May 15, 2025

Exemptions help you protect what you own when you file bankruptcy. If you file Chapter 7 bankruptcy as an Idaho resident, you must use the state’s exemption laws. Idaho provides a generous homestead exemption up to $175,000 and a motor vehicle exemption of $10,000. Additionally, Idaho offers a wildcard exemption of $800, which you can apply to any property you choose.

Written by Attorney Eva Bacevice. Legally reviewed by Jonathan Petts
Updated September 2, 2025

Every state has its own set of bankruptcy exemptions. There is also a set of federal bankruptcy exemptions contained in the United States Bankruptcy Code. Several states, including New Jersey, allow residents to choose between taking the New Jersey bankruptcy exemptions and the federal exemptions. It’s important to note that you have to pick one set of exemptions and stick to it, you can’t pick and choose from both New Jersey exemptions and federal, rather go with the set that gives you the most protection. If you decide to go with the state exemptions you can also use the federal nonbankruptcy exemptions as a supplement, so long as you meet the qualifications.

Written by the Upsolve Team. Legally reviewed by Attorney Andrea Wimmer
Updated August 13, 2025

Bankruptcy exemptions help bankruptcy filers protect the property they own so they don't have to start over with nothing after their debts are discharged. Colorado has opted out of the federal bankruptcy exemptions, so residents must use the state exemptions instead. Fortunately, Colorado has generous bankruptcy exemptions, including a $250,000 homestead exemption (for filers under 60) and a $15,000 motor vehicle exemption.

Written by Attorney Karra Kingston. Legally reviewed by Jonathan Petts
Updated September 2, 2025

If you’ve been an Indiana resident for at least two years when you file Chapter 7 bankruptcy, you’ll be required to use the state’s bankruptcy exemptions to protect your property and belongings. Indiana offers a $22,750 homestead exemption you can use to help protect your primary residence. There is no motor vehicle exemption in Indiana, but you can use the state’s $12,100 wildcard exemption to protect your car and other personal property.

Written by Attorney Karra Kingston. Legally reviewed by Jonathan Petts
Updated September 2, 2025

Exemptions help bankruptcy filers protect their property and assets. If you're looking to file bankruptcy and exempt your property in Tennessee, you'll be limited to Tennessee’s exemptions only. Filers in Tennessee can't use the federal exemptions. That said, you can use federal nonbankruptcy exemptions to protect certain retirement accounts and disability benefits.

Written by Attorney Karra Kingston. Legally reviewed by Jonathan Petts
Updated September 2, 2025

Exemptions are used to protect your property and assets as you go trhough bankruptcy. You can choose from two sets of exemptions when you file Chapter 7 bankruptcy in Minnesota — federal bankruptcy exemptions and Minnesota bankruptcy exemptions. If you choose to use Minnesota’s bankruptcy exemptions, you may also use the federal nonbankruptcy exemptions to protect retirement accounts and disability benefits.

Written by Attorney Karra Kingston. Legally reviewed by Jonathan Petts
Updated August 25, 2025

Alabama residents of at least two years filing Chapter 7 bankruptcy will need to use the state’s exemptions to protect their personal property during the case. Alabama’s homestead exemption is $18,800 (as of July 1, 2023). It also offers a $9,400 wildcard exemption that you can use to protect most types of personal property, including a vehicle, with a few exceptions. Filers in Alabama can also use the federal non-bankruptcy exemptions to protect certain benefits and retirement funds.

Written by Attorney Andrea Wimmer. Legally reviewed by Jonathan Petts
Updated September 2, 2025

The homestead exemption helps protect the equity in your home if you file Chapter 7 bankruptcy. This protection makes it possible for many homeowners to get relief from credit card debt, medical bills, and other unsecured debts without losing their house. There’s a federal exemption, and each state sets its own exemption rules. How much home equity you can protect depends on where you live. If your equity goes over the exemption limit, you may still have options, including Chapter 13 bankruptcy and other forms of debt relief.

Written by Attorney Kassandra Kuehl. Legally reviewed by Jonathan Petts
Updated September 2, 2025

Massachusetts law allows for most residents to choose between federal bankruptcy exemptions and state exemptions to property that could be affected by the bankruptcy process. The only time that this choice is not available is if a filer is a new Massachusetts resident and has lived in the state for less than two years. By examining each approach below, you can determine whether your case will be served best by applying Massachusetts exemptions or by claiming those available under federal law. Oftentimes, both schemes do an equally adequate job of safeguarding a filer’s property. But sometimes, it’s advantageous to choose one option over the other.

Written by Attorney Kassandra Kuehl. Legally reviewed by Jonathan Petts
Updated September 16, 2025

Utah law requires residents who have lived in the state for at least two years to use its state exemptions when filing Chapter 7 bankruptcy. Exemptions protect your property during the bankruptcy process so that you can get a financial fresh start without having to start from scratch. If you’re filing as a single person, the homestead exemption in Utah is $42,000. The motor vehicle exemption is $3,000. Utah doesn’t offer a wildcard exemption.

Written by Attorney Kassandra Kuehl. Legally reviewed by Jonathan Petts
Updated September 2, 2025

Only 17 states allow their residents to choose between claiming state exemptions and federal bankruptcy exemptions. South Carolina is not one of these states. Instead, South Carolina law provides residents with state-specific exemptions and does not allow its residents to claim federal exemptions. While some federal law in the Bankruptcy Code does influence how some South Carolina exemptions are structured, the kinds of exempt property filers can claim and the exemption amounts that apply to bankruptcy cases are state-specific. It’s important to note that if you have lived in South Carolina for less than 2 years, you may not be able to claim South Carolina’s exemptions to your property.

Written by Attorney Kassandra Kuehl. Legally reviewed by Jonathan Petts
Updated August 25, 2025

If you’ve lived in Arkansas for at least two years and you’re filing Chapter 7, you can choose between the federal or state bankruptcy exemptions. Bankruptcy exemptions are laws that help you protect your property when you file your case. For many types of property and belongings, federal exemptions are more generous for filers. However, Arkansas does have a generous acreage-based homestead exemption, which can be useful if you’re a homeowner.

Written by Krishna Patel. Legally reviewed by Attorney Andrea Wimmer
Updated September 2, 2025

Many people who file bankruptcy are able to keep their home, but whether or not you’ll be able to do so depends on several factors. To keep your home in Chapter 7, you’ll need to be up to date on your mortgage payments and your home equity must be covered by the homestead exemption in your state. In Chapter 13, you can catch up on missed mortgage payments through a repayment plan, which can help you keep your home and avoid foreclosure.

Written by Attorney Karra Kingston. Legally reviewed by Jonathan Petts
Updated September 9, 2025

If you’ve been a Georgia resident for the last two years before you file Chapter 7, you’ll need to use the state’s exemptions to protect your property during your bankruptcy. Exemptions are laws that outline what property you can keep during bankruptcy. The Georgia homestead exemption is $21,500. The motor vehicle exemption is $5,000. Georgia also has a wildcard exemption you can use to protect other personal property up to $1,200. If you don’t use the full homestead exemption, you can apply up to $10,000 of the unused portion to protect personal property as well.

Written by Attorney Paige Hooper. Legally reviewed by Jonathan Petts
Updated September 1, 2025

Life insurance can affect your bankruptcy case if your policy has cash value or if you receive a payout after someone passes away. Whether you can keep the policy or the money depends on your state’s exemption laws, the type of policy, and when the money becomes yours. Some life insurance is fully protected in bankruptcy, but other parts might count as assets the trustee can use to repay creditors. Understanding what kind of policy you have is the first step. If you’re not sure how this applies to your situation, consider setting up a free consultation with a bankruptcy attorney.

Written by Attorney Andrea Wimmer. Legally reviewed by Jonathan Petts
Updated September 16, 2025

If a creditor sues you to collect on an unpaid debt and wins, they'll get a court judgment against you. This court order allows them to collect on the debt by seizing your real or personal property (or putting a lien on it), garnishing your wages, or levying your bank account. Personal property includes everything from household goods to vehicles. Real property includes things like your home or land. Though creditors can legally seize real and personal property that isn’t covered by an exemption, this isn't common because it can be costly for creditors. It's more common for creditors to use wage garnishment or a bank account levy.

Written by Attorney Kimberly Berson. Legally reviewed by Jonathan Petts
Updated September 2, 2025

Typically, a mortgage default occurs if the borrower misses payments, fails to pay real estate taxes, or fails to pay for homeowner’s insurance. A mortgage default could occur if the borrower transfers the title to a new owner without the consent of the lender. Default terms vary depending on the loan type and mortgage contract.

Written by Ben Jackson. Legally reviewed by Attorney Andrea Wimmer
Updated September 1, 2025

If you’re behind on your mortgage loan payments and are now getting back on your feet, a mortgage reinstatement can help you bring your mortgage current. If you reinstate your loan and start making regular payments again, you won’t have to fret over a potential foreclosure or losing your property. Keep reading and we’ll help you learn more about what a mortgage reinstatement is, how it works, and what you can do if you’re not able to reinstate your mortgage.