Texas Bankruptcy Basics
Texas has two different types of bankruptcy for consumers who cannot
find their way out of debt in a maximum of five years. Other types of
bankruptcy are available for family-owned farms and business
corporations. Not all those who apply for bankruptcy are granted
bankruptcy from the court.
Chapter Thirteen bankruptcy can be re-filed any time after the entire
process has been completed. Chapter Seven bankruptcy cannot be re-filed
until six years has passed after the date of the first bankruptcy's
completion. A husband and wife may petition for bankruptcy in a joint
petition or a single individual may petition for bankruptcy on his or
Chapter Thirteen Bankruptcy
Chapter Thirteen bankruptcy includes the relieving of debts through
personal income. Those that qualify for this chapter of bankruptcy will
have a repayment plan personally created for them by the court. The
court will evaluate how much income is possible and how much debt is
A payment plan will then be created for how much is necessary to be
paid each month in order to have the debt paid off in no more than five
years. At times, based on the income and the debt amount, the debt can
be paid off in three years.
Chapter Seven Bankruptcy
Chapter Seven bankruptcy is designed to eliminate debts through the
sale of personal property and assets. The court will assign a trustee
to the case. He or she will evaluate the values of the property and
will liquidate all the non-exempt property. This property is whatever
assets are not necessary to daily life.
The compensation will then be used to pay off creditors. Before all the
creditors are paid, the trustee will be paid through the compensation
made. The entire Chapter Seven bankruptcy process can be completed in
Texas Bankruptcy Exceptions
Chapter Seven bankruptcy calls for the liquidation of non-exempt
property. Texas has set the kinds of property that are noted as exempt
into different asset categories. These categories include personal
property, homestead, insurance, pension, miscellaneous, tools of trade,
public benefits, and wages.
Each category includes various exemptions at different values.
Generally each property is required to be under a certain amount in
order to be deemed exempt.
Homestead assets can include one acre of property in town, one hundred
acres out of town boundaries, and proceeding sales after six months.
Personal property assets can include health aids, burial plots, food,
jewelry with values under the twenty-five percent exemption, two
horses, heirlooms, sports equipment, and motor vehicles.
Insurance assets can include Texas state college employee benefits,
life, health, church benefits plan benefits, accident benefits, and
retired public school employees. The entire miscellaneous asset
category includes business partnership property. Pension assets can
include judges, firefighters, police officers, county employees,
district employees, and teachers.
Public benefits include workers' compensation, medication assistance,
crime victims' award, unemployment compensation, and public assistance.
Wages include earned yet unpaid wages and commissions up to
seventy-five percent that are yet to be paid. Tools of trade assets
include framing equipment, tools, ranching vehicles, boats, and books.