When considering filing for Chapter 7 Dallas bankruptcy, you may have come across the term “no-asset” bankruptcy. If you are wondering what “no-asset” bankruptcy means, look no further. A Chapter 7 no-asset case simply means that the debtor has no non-exempt assets that the bankruptcy trustee can sell to help cover the debts owed creditors prior to discharge. It is estimated that a vast majority of Chapter 7 bankruptcies are no-asset bankruptcies. Property that can be claimed as exempt does not count toward the filing.
No-Asset Chapter 7 Filing
A no-asset Chapter 7 bankruptcy filing means that all your property worth enough to be considered an asset is exempt under Texas bankruptcy law from being considered for sale to cover your debts. The principle behind exemptions is that a person must come out of a Chapter 7 bankruptcy filing with their vital property intact, or else they will not be able to make a fresh start and the purpose of the filing will have become moot. The list of exemptions varies state by state, and Texas bankruptcy has a fairly long list of exemptions, so be sure to consult with an expert bankruptcy lawyer before filing to ensure you get to keep all your exempt property under the law. At the very least, most states include your home (or a home up to a certain value) and car (again, up to a certain value – your Lamborghini may not be exempt, but a Toyota Corolla probably will).
These exemptions serve to keep a Chapter 7 debtor on their feet after filing bankruptcy and are vital tools for those considering filing. A No-asset Chapter 7 is one of the simplest kinds of bankruptcy and normally results in a full discharge for the debtor of all their eligible debts, while allowing them the assets required to make a new start without having to begin again from zero.