What assets does bankruptcy status protect?

What assets does bankruptcy status protect?

Janet Bodnar (Deputy Editor, Kiplinger’s Personal Finance) gives expert video advice on: Who is eligible to file for personal bankruptcy?; How do I file for bankruptcy?; How long will filing for bankruptcy impact my credit rating? and more...

The assets that bankruptcy status protects varies from state to state. Every state outlines it's own assets, and some are more generous than others. But in general, you really do get a lot of protection.The home equity – the equity that you have in your home – is protected to a certain extent with bankruptcy status. Your car is usually protected to a certain extent with bankruptcy status. You personal property; the theory being that people – debtors or lenders – are not going to recover anything if you can't drive to work and earn a paycheck, or if you don't have a home to live in. And some states are more generous than others; in some states none of your home equity can be tapped in order to pay off your creditors in bankruptcy. So it depends on where you live, but it is true that you'll be able to keep a lot of your assets, that will not be allowed to be sold to satisfy your creditors.