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

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).

Nashville, TN -

Attorney Answers (3)

Paula Brown Sinclair

Paula Brown Sinclair

Bankruptcy Attorney - Twin Falls, ID
Answered

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.
J. Thomas Smith Ph.D.

J. Thomas Smith Ph.D.

Chapter 13 Bankruptcy Attorney - Houston, TX
Answered

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 www.... more
Matthew Scott Berkus

Matthew Scott Berkus

Bankruptcy Attorney - Denver, CO
Answered

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.

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