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What is a No-Asset Bankruptcy?


If you are considering the possibility of filing for Chapter 7 bankruptcy in South Florida, you likely know that Chapter 7 bankruptcy is a form of liquidation bankruptcy. Accordingly, if you do file for Chapter 7 as an individual (or as a married couple), all of your non-exempt assets will be liquidated so that creditors can be repaid as fully as possible and so that you can receive a discharge of your eligible debts. Yet even if you have a general sense of how Chapter 7 works, there are a number of terms that can arise with individual bankruptcy cases that can be confusing or simply unclear. One term that you might have come across in this type of bankruptcy filing is a “no-asset bankruptcy.” Given that certain assets are exempt in Chapter 7 cases in Florida, you may be wondering what a no-asset bankruptcy case is, and how it could impact you.

In short, a no-asset bankruptcy case is not a problem for a debtor, but rather is a term that refers to the impact on creditors. Our West Palm Beach bankruptcy attorneys can explain in more detail.

Understanding No-Asset Chapter 7 Bankruptcy Cases 

What is a no-asset bankruptcy if you can keep your exempt assets? A “no-asset bankruptcy” is, quite simply, a Chapter 7 bankruptcy case in which there are no non-exempt assets that can be liquidated, which means that creditors will not receive any money. To be clear, there are no assets that can legally be sold to repay creditors, so for the creditors, it is a no-asset case in which the creditor cannot expect to receive any portion of the money they are owed by the debtor.

How can a debtor end up in a situation where none of their assets must be liquidated? A no-asset bankruptcy occurs when a debtor can use available bankruptcy exemptions to exempt all of their assets.

How to Determine If I Will Have a No-Asset Bankruptcy Case 

How can you determine if it is possible for you to have a no-asset bankruptcy case and to keep all of your property? You will need to be able to show that there are available exemptions that apply to all of your assets. Given that there are a wide range of exemptions available to individual debtors under Florida law, it is essential to discuss the exemptions that are likely to apply to you with your bankruptcy lawyer. In general, however, the following are commonly used exemptions listed in the Florida Statutes:

  • Homestead exemption (many Florida homeowners can keep all of the equity in their house);
  • Up to $1,000 of any personal property you choose (or up to $4,000 if you do not use the homestead exemption);
  • Up to $1,000 equity in your carl
  • Up to $750 of wages per week, or 75 percent of 30 times the federal minimum wage (whichever is greater);
  • Prescribed health aids;
  • Retirements accounts and pensions; and
  • Public benefits.

Contact a West Palm Beach Bankruptcy Attorney Today 

Whether you are in the initial stages of merely considering a Chapter 7 bankruptcy or you feel ready to file and have questions or need legal help, one of the experienced West Palm Beach bankruptcy lawyers at Kelley Kaplan & Eller, PLLC is here to assist you. A lawyer at our firm can speak with you today about your eligibility for Chapter 7 bankruptcy, and we can represent you at every stage of your case, from pre-filing issues to the point at which you receive your discharge. Contact us today to get started on your Chapter 7 bankruptcy case in South Florida.




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