Implications Of Filing For Bankruptcy On Assets

You may lose your property. In a Chapter 7 bankruptcy, often referred to as liquidation, a court-appointed trustee will dispose of many of your assets in order to pay your creditors. Those assets include real estate (other than your primary residence), a second car or truck, boats, valuable collections, bank accounts, and non-retirement investments. You are allowed to keep what's referred to as exempt property, such as a portion of the equity in your home and car, personal items, clothing, any tools needed for your work, and retirement accounts.

In a Chapter 13 bankruptcy, you are allowed to keep your assets, as long as you adhere to a three- to five-year plan to repay your creditors.