When you are in debt and have exhausted all potential options to help ease your financial obligations, you may turn to bankruptcy. However, one of the primary concerns for those who are eligible for Chapter 7 is what will happen to their personal property, and specifically jewelry like an engagement or wedding ring. If this represents your concerns and hesitations with filing, the following blog explores what you should know about the Chapter 7 process and the importance of working with a Memphis, TN Chapter 7 bankruptcy lawyer to help you through these complicated matters.
Will My Property Be Seized During Bankruptcy?
When you file for Chapter 7 bankruptcy, it’s important to understand that this process generally results in the liquidation of your eligible assets. This means that the trustee assigned to your case can seize your assets and sell them to repay your creditors. These assets are non-exempt, meaning they are not protected under any bankruptcy exemptions, nor are they considered essential for your livelihood.
What Happens to My Wedding Ring During This Process?
In most instances, everyday apparel is exempt from bankruptcy, as it is considered “necessary wearing apparel,” which typically includes the bulk of your wardrobe. However, there are some exemptions, specifically in relation to luxury or designer items. While other states have adopted amendments to this statute to include wedding or engagement rings in the category of necessary wearing apparel, this is not the case in Tennessee. Unfortunately, the law is vague regarding this issue, meaning it is up for interpretation during your case.
Your attorney can argue that, because it is customary and the standard to wear a wedding ring, coupled with the unique sentimentality of the item, it should be exempt. However, the trustee assigned to your case may use the vague law surrounding this issue to argue that it should be included. This is especially likely if your engagement or wedding ring is of considerable value.
Though you may be worried about the prospect of losing your wedding or engagement ring, it’s important to understand that you also have the potential to keep the ring by using an exemption. During bankruptcy, you have the ability to exempt some property from being included in your filing. As such, you may be able to utilize a wildcard exemption, which protects up to $10,000 of personal property during bankruptcy.
If you are considering filing but you are worried about the implications it will have for your wedding ring, it’s imperative to connect with an experienced attorney during this process. At the Arnold Law Firm, our experienced team will do everything possible to help you fight for the best outcome so you can reap the full benefits of this process. Contact us today to learn more.
