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Liquidating property does not mean selling off everything

One of the most intimidating aspects of Chapter 7 bankruptcy is asset liquidation. Tennessee residents who use Chapter 7 bankruptcy may not earn enough income to pay off their debts over time and, therefore, may be required to sell their property in order to have money to give to their creditors. Asset liquidation is the process of selling the things that a person owns, but readers should know that they will not need to give up everything they own in order to complete the Chapter 7 bankruptcy process.

For example, individuals who have two homes, such as a primary residence and a vacation home, may be required to sell their vacation property. If a person owns a regular vehicle and a sports car, the sports car may be subject to liquidation since the individual technically may not need that item to maintain their life after their bankruptcy is over.

Some types of property, like artwork, collections and other valuable assets, are generally subject to liquidation through Chapter 7 bankruptcy. However, items of personal property, like clothing, household appliances and other home goods, may be exempt from liquidation.

Bankruptcy liquidation can be hard on some debtors, but without the income or means to pay off creditors, it can be a good way for an individual to start taking control of their financial situation. Chapter 7 bankruptcy involves liquidation, but bankruptcy exemptions can help individuals protect some types and amounts of their possessions. Different laws can control what exemptions are available to debtors and, therefore, our readers may need to get more information about their own unique circumstances.

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Kenneth C. Rannick, P.C.
4416 Brainerd Road
Chattanooga, TN 37411

Phone: 423-624-4002
Toll Free: 800-257-7594
Fax: 423-624-0509
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