One mistake that people sometimes make when thinking about bankruptcy is to assume that they have to give up all the assets that they own. They understand that Chapter 7 erases their debt, but it does so by liquidating those assets. This means that they have to be sold off and the money is used to pay the debt.
You can imagine why this would make people a bit worried to file for bankruptcy. What is the point of eliminating all of your debt if you’ve also lost all of your assets? Thankfully, this is not actually how it works.
You have numerous exemptions
The law is written in such a way that it won’t make you destitute just because you’ve filed for bankruptcy, and you’re not going to lose all of the assets that you own.
For example, Georgia offers a homestead exemption that can be used so that you can keep your house. It’s tied to the equity that you have in your house. The exemption is $21,500 for an individual and it is doubled for a couple.
There’s also an exemption for jewelry, which is capped at $500. So people are not allowed to keep frivolous things that they own, such as very expensive jewelry collections, but you can probably keep family heirlooms and other things that are important to you.
You even have something called a wildcard exemption. This gives you $10,000 that you can use for anything that you want. You can protect assets that are important to you, even when they don’t fall into another category.
Exploring your options
These are definitely not all the exemptions you can use, but you can see how they protect your property while still eliminating your debt. You may consider knowing about all the options that you have.