ABA Family Legal Guide

Consumer Bankruptcy

Straight Bankruptcy: Chapter 7

Chapter 7 Defined

Can I convert any non-exempt assets into exempt assets without losing my bankruptcy discharge or my exemptions?

Yes, if done correctly. Pre-bankruptcy planning is an essential part of nearly every bankruptcy. A bankruptcy attorney's advice on this issue is valuable. In general, during the conversion process, you cannot use unsecured credit to increase your exempt assets, sell non-exempt assets for less than fair value, or mislead your creditors during the conversion process.