Bankruptcy Laws in Texas

Every state has different laws regarding bankruptcy. It is very important to understand the Bankruptcy laws that apply to your state. If you are considering filing for Bankruptcy in Texas then you need to understand the Bankruptcy Texas laws. It is highly recommended to hire a Bankruptcy Attorney to represent you. You can almost always get a free consultation with a Bankruptcy Attorney to start with.

The Bankruptcy Code

The Bankruptcy code permits different states to deviate from the set of Federal rules in very limited circumstances. For example, there is an asset known as exempt assets. This exemption allows the debtor to keep a few of his personal assets safe from the creditor. In many cases the creditors will repossess assets owned by the creditors in order to make up for their losses. The Bankruptcy Code allows the states to expand and choose the exempt assets. In otherwords not every state has the same Bankruptcy law and the procedure of the case depends on the state in the case is filed.

Different Chapters in Bankruptcy

Chapter 7
The most common Chapters in consumer bankruptcy cases are Chapter 7 and Chapter 13. Chapter 7 is often called liquidation Bankruptcy and is filed by people who just want to eliminate all of their debts. If Chapter 7 is filed a trustee is appointed to liquidate the assets of the debtor. The proceeds from the liquidated assets are then distributed.

Chapter 13
Often times the Texans that file for Chapter 13 are employed but they are afraid of foreclosure. They may owe substantial amounts of money in taxes or student loans that cannot be mitigated in Chapter 7.

What Can a Bankruptcy Texas filer expect to keep
If you are filing for bankruptcy in Texas you can choose either the federal exemption guidelines or the Texas exemptions depending on which are more suitable for your individual situation.


The federal exemptions allow you to keep:

* Your home up to $20,200
* Life insurance payments for individuals you depend upon for support
* Life insurance policy with loan value up to $10,775
* Unmatured life insurance contract, excluding credit insurance policy
* Alimony and child support used for support
* Pensions and Retirement Benefits, ERISA-qualified benefits needed for support
* $525 per item in household goods for a total value of up to $10,775
* Health aids
* Jewelry up to $1,350
* Lost earnings payments
* Your motor vehicle up to $3,225
* Personal injury compensation payments up to $20,200, wrongful death payments, crime victims' compensation, public assistance, social security, unemployment compensation, and veterans' benefits
* Tools of trade up to $20,200
* Wild Card - $1,075 of any property plus up to $10,125 of any amount of unused homestead exemption

The Texas exemptions allow you to keep:

* Your home, if not more than 10 acres in town or 100 acres out of town (200 acres for families)
* $30,000 worth of personal property ($60,000 for head of family), including one two-, three- or four-wheeled vehicle; two horses, mules or donkeys and a saddle, blanket and bridle for each; 12 head of cattle,; 60 head of other livestock; 120 fowl; pets. Athletic and sporting equipment, home furnishing, family heirlooms; food and clothing; jewelry (but not to exceed 25 per cent of total exemptions); tools of your trade
* Burial plots
* Health aids
* Unemployment, disability, veterans', workers' compensation and social security benefits
* Alimony and child support
* Retirement plan and life insurance proceeds
* Business partnership property
* Farming or ranching vehicles and implements

So, if you are unsure whether Bankruptcy Texas could be the right step for you please consider consulting with a reputable Bankruptcy Attorney today to find out. You can not move forward wisely without knowing all of the facts.