Delaware Bankruptcy Laws

The state of Delaware has one bankruptcy district court: Delaware Bankruptcy Court. This court serves the entire state of Delaware . Bankruptcy provides debtors with a fresh start because bankruptcy protects consumers against lawsuit from creditors. This protection is extended after you've undergone the mandatory credit counseling and filed your case with the Court. Until that time collectors can still collect on your credit card debts and other debts you owe, including your mortgage.

Delaware Bankruptcy Exceptions
The Chapter 7 Bankruptcy Code allows you to keep property or assets such as a car, home, land and other assets by claiming them as "exempt" under Federal and State bankruptcy exemption laws. According to Lawyers.com, under Delaware bankruptcy laws, you may keep:

• Family Bible, school books, family library, family pictures, seat or pew in a church or public place of worship, a lot in any burial ground and clothes.
• Tools, implements and fixtures needed to carry on trade or business, not exceeding $75 in New Castle and Sussex Counties or $50 in Kent County.
• Sewing machines used by seamstresses or private families.
• Pianos or organs that are leased or hired.
• Personal property to $500.
• 85% of wages, salaries and commissions.
• Partnership property.
• Estate property to $5,000, except tools of the trade.
• Retirement plans and rollover contributions.
• Employee group life insurance proceeds.
• Insurance proceeds.
• Annuity contract proceeds.
• Workers' compensation payments.
• Unemployment compensation.
• Public assistance.

NOTE: These are the major bankruptcy exemptions. Check with your bankruptcy lawyer for a full exemptions list.

New Bankruptcy Law Changes - Outlines major changes you should know about in the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA), also known as the new bankruptcy laws.

This is important! The new bankruptcy law requires all debtors to fulfill two education requirements: a credit counseling course prior to filing and a financial management course before obtaining a discharge. Failure to complete either of these courses and file the appropriate certificates with the court will prevent a successful bankruptcy. The Chapter 13 Trustee will offer the required courses to Chapter 13 debtors, but Chapter 7 debtors are required to take the courses on their own.

Find a U.S. Trustee Approved Pre-Bankruptcy Counseling Provider and Post-Filing Debtor Education Provider.