When debts are overwhelming, filing for bankruptcy may be your only option. Many people prefer Chapter 7 Bankruptcy. In this chapter, all your non-exempted assets will be sold or liquidated which can be an avenue to pay all your debts. As this is a supervised procedure, the court will appoint a trustee to get sales from all the non-exempt assets of the defaulter and appropriate the sales money to various creditors. Bankruptcy chapter 7 exemptions refers to assets that you get to keep when the bankruptcy is filed.

Although chapter 7 is the least favorite method of bankruptcy, with the help of exemptions, you could effectively reduce your personal damage and you don't have to sell everything.

In this exemption the debtor keeps the property that he is allowed to keep. This list will be provided in the Federal Bankruptcy Code. The property shall be separated as exempt or non-exempt when the state trustee files a property exemption report. Take note that while the basic law may be the same, some exemptions may vary in other states.

Secured debts are first paid off but if the debt is unsecured, there are possibilities that the creditors might not get any money at all. The trustee makes sure that the right creditors get the deserved money in the right way. To get bankruptcy chapter 7 exemptions, the debtor must file the case in the state where he/she resides for a period of 730 days before filing for this type of bankruptcy. Alternatively, the debtor may also file the case in a state where he/she has spent most of the 180 period prior to the 2-year period.

There are some Federal exemptions and they can include retirement benefits, death disability benefits, survivor's benefits and miscellaneous. Although, keep in mind that these may not be available in all states.

Yes, bankruptcy is not a good alternative and worst still, your credit score will have a major impact because of a filing of bankruptcy. You will lose most of your possessions and you need start a new leaf, both personal and business wise. Remember, bankruptcy should always be your last alternative.

If, unfortunately, you have no other options, then it will help to learn more about bankruptcy chapter 7 exemptions as it can help you reduce your personal loss of assets and make use of it in a way to help get back on your feet at the earliest.