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Navigating bankruptcy in Virginia: What property can you keep?

On Behalf of | May 8, 2023 | Bankruptcy

Filing for bankruptcy does not mean starting over from scratch with nothing to your name. It would beat the purpose since you are already in a financially difficult position.

The law is aware that giving up everything you own will not alleviate the situation. It is why bankruptcy exemptions exist at the federal and state levels. It means you can exempt specific assets from the bankruptcy process and get to keep them after filing. Here are some of the exemptions under Virginia laws.

Virginia bankruptcy exemptions

Virginia exemptions allow you to keep certain types of property essential for your day-to-day life and financial well-being after filing for bankruptcy. They include:

  • A homestead exemption of up to $25,000
  • A motor vehicle exemption of $6,000
  • The larger of 75% of your wages or 40 times the federal minimum wage
  • Personal property exemptions ($5,000 in household furnishings, $1,000 in clothes, $3,000 in firearms, up to $5,000 in family portraits and heirlooms, pets, wedding rings, etc.)
  • Tools of your trade valued up to $10,000
  • Public benefits
  • Some retirement accounts, among others

It’s worth noting that Virginia laws allow you to choose between federal and state exemptions. However, once you go with one, it will apply throughout. For instance, you cannot exempt your homestead by federal guidelines and choose state laws for a motor vehicle exemption.

Learn more about how bankruptcy exemptions work

Before filing for bankruptcy, it helps to have a complete picture of how things work and what to expect when all is said and done. It can help you plan for the days ahead and ensure you make decisions that are in your best interests as you work towards regaining financial freedom.