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More Bankruptcy Help

Can creditors take away necessities such as basic household

furnishings and clothing to satisfy what is owed to them?

No. The purpose of a bankruptcy is to give debtors a financial "fresh start"

and not to remove all of their property. Therefore, the law allows every

debtor to protect certain property from their creditors, even if the value of the

assets is greater than his or her debts. The bankruptcy law specifies that

various items of personal and real property belonging to a debtor cannot be

taken by creditors in order to satisfy their claims. Such items are "exempt"

(protected) property. New York State has laws specifying what property may

be claimed as exempt when a debtor is filing for bankruptcy. These items

include, but are not limited to:

- Clothing and household goods such as household furniture, a stove,

refrigerator, radio, television, cookware, tableware, sewing machine,

books and pets.

- Cash up to $2,500 (this can include an income tax refund), unless an

exemption for real property (real estate) is claimed.

- Alimony, maintenance or child support owed to the debtor.

- The right to receive certain awards and benefits such as Social Security,

SSI, Unemployment Compensation, Public Assistance Veteran's Benefits,

Disability Benefits, Worker's Compensation Benefits and Personal Injury

Awards (up to $7,500 not including pain and suffering and actual

monetary loss).

- Pensions, Keogh, 401(K), 403(B) Plans, IRA and most annuities.

- A cemetery plot.


- A motor vehicle, up to $2,400 in market value over any financed amount

owed on the vehicle.

Expensive cars (see below), jewelry, real estate or investments (except

retirement accounts) might have to be surrendered as a result of filing a

Chapter 7 case, but a debtor may retain such property if he or she files a

Chapter 13 case with an approved repayment plan.

Please call us at 518-374-8494 for any questions. Also take a look at the US bankruptcy's court website for even more helpful information.