The bankruptcy process is designed to be a tool of help for those struggling with debt. One of the many benefits bankruptcy can offer is the chance to resolve debts with minimal cost to you. Although some of your assets could be used to satisfy payments to creditors, most of your valuables are protected under bankruptcy exemption laws.
State and Federal
According to the bankruptcy code, debtors filing bankruptcy can protect certain assets from liquidation under either a federal exemption or one provided by the state. Debtors can choose which of the exemption laws they want to claim protection under, the only differences being the different level of protections.
For example, Texas bankruptcy exemptions are some of the most forgiving in the country. In Texas, debtors can exempt their home up to an unlimited dollar amount. Compared to the value cap of $ 125,000 the Texas exemption is very generous. Texas also offers a greater value in personal property protection compared to other states and the federal exemptions, such as $30,000 for a single adult, and $60,000 for a family. This includes everything from furniture and clothing, to vehicles, antiques, tools and motorized vehicles.