What are the Delaware Bankruptcy Exemptions?
Delaware law protects all or a portion of your property from being seized by creditors or the bankruptcy trustee in a Chapter 7 bankruptcy. In a Chapter 13 bankruptcy, you are generally allowed to keep all of your assets and property. Certain exceptions may apply, so it’s wise to consult with a Delaware bankruptcy attorney to find which of your assets will be protected in a bankruptcy filed in Delaware. In general, the major Delaware bankruptcy exemptions include:
| GENERAL DELAWARE EXEMPTIONS |
|---|
| Real Estate (the Homestead Exemption) Up to $50,000 of equity in your principal residence can be protected.A provision in the new bankruptcy law caps the homestead exemption at $125,000 if you have not lived in the state for at least 40 months prior to the time you file a bankruptcy petition. In some situations, the cap may be permanent. You should consult with a Connecticut bankruptcy attorney for specific information. |
| Automobiles There is no specific automobile exemption in Delaware. |
| Other Property A vehicle and/or tools of the trade in the amount of $15,000; $25,000 in fair market value of other property can be protected. |
| View the complete list of Delaware bankruptcy exemptions |
Please remember that this page provides general information only, and is not intended to provide legal advice. The information is not a substitute for the advice of a qualified bankruptcy attorney. If you need legal assistance, consult an attorney.
Which state’s exemption laws apply in your bankruptcy?
Generally, the laws of the state in which you lived for the 730 days (2 years) prior to filing a bankruptcy petition will apply in your bankruptcy.
If you have not lived in the same state for 2 years immediately prior to filing your bankruptcy petition, the laws of the state in which you lived for the majority of the 180-day period preceding the 2-year period will likely apply.
If the application of the preceding general rules renders you ineligible for exemptions under any state’s laws, you may be allowed to choose the federal exemptions applicable in your bankruptcy.
Is Delaware a community property state?
No, Delaware is not a community property state. Because it is not a community property state, you will be responsible for your spouse’s debts only if you voluntarily assumed those debts by, for example, co-signing on a loan given to your spouse. In a non-community property state, one spouse can file for bankruptcy and be eligible to eliminate all of their unsecured debts without the involvement of the other spouse.
Did your senator vote in favor of the new bankruptcy laws?
Following years of intense lobbying by creditors, Congress passed the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA). How did your Senators vote on these largely pro-creditor provisions?
Biden (D-DE) — YEA
Carper (D-DE) — YEA
Delaware Bankruptcy Court Locations:
824 North Market Street
3rd Floor
Wilmington, Delaware 19801
(302) 252-2900
Note: You may not have to actually go to one of the above bankruptcy courts. Trustees often conduct your meeting at a local venue.
Although bankruptcy is federal law, the bankruptcy courts in each jurisdiction have local rules that must be followed. A local bankruptcy attorney will be familiar with the specific rules in your area.