What is non-exempt property?
Non-exempt property is that property which is not protected by law from being taken by creditors in a bankruptcy. In Virginia, a debtor is allowed to exempt (“protect”) a significant amount of property, including $5,000 worth of household goods, $2,000 worth of equity in an automobile, an additional $5,000 worth of equity in any other property. Click here if you want to read the actual text of the exemption statutes. Each partner in a marriage can claim a separate exempt estate, essentially doubling the value of the property that can be protected. In most cases, the exemptions are more than enough to protect all of the debtor’s property. Occasionally, a debtor will have property that exceeds the amount that can be exempted (for example, a large equity stake in a home). In such cases, careful planning must be done to determine how, if at all, a bankruptcy should be approached. Generally, the non-exempt property can be “bought back” from the creditors with a properly drafted Chapter 13 p
