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Chapter 7. When a security interest was given in personal property are any items exempt from creditors in spite of that fact?

Nashville, TN |

The combined value of all my personal property is less than maximum allowed exemption. I entered into a “Promissory Note and Security Interest” agreement with a creditor which granted a security interest in some personal property items ( desktop computer, notebook computer, 2 monitors, telephone system, drill, watch, encyclopedia set, binoculars).

Attorney Answers 3

  1. Best answer

    I respectfully disagree with Mr. Berkus. Under 11 USC 522(f) non-possessory non-purchase money liens on household goods (typical of finance company loans) ARE avoidable in bankruptcy. How much of the property itemized is considered household goods is a matter of state law. Because a motion with particular allegations is required, representation by experienced counsel is appropriate.

    Best wishes for a favorable outcome, and please remember to designate a best answer.

    This answer is offered as a public service for general information only and may not be relied upon as legal advice.

  2. When you voluntarily grant a security interest in an item, exemptions don't apply. However, very few creditors will actually try to enforce such a lien on personal property.

  3. I agree with Attorney Sinclair.

    Law Offices of J Thomas Smith J.D., Ph.D 11500 Northwest Freeway, Suite 280 Houston, TX 77092 713-LAWYER-2 NOTE: Responses are for the education of the community at large and is not intended to be "legal advice." No attorney-client relationship is established by responses or comments.

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