{"id":286854,"date":"2021-04-21T12:49:49","date_gmt":"2021-04-21T17:49:49","guid":{"rendered":"https:\/\/ability-fl-prod.internetbrands.com\/ability-law\/bankruptcy\/bankruptcy-laws-by-state\/maryland-bankruptcy-exemptions-and-law.html"},"modified":"2026-09-09T16:57:47","modified_gmt":"2026-09-09T21:57:47","slug":"maryland-bankruptcy-exemptions-and-law","status":"publish","type":"page","link":"https:\/\/www.findlaw.com\/state\/maryland-law\/maryland-bankruptcy-exemptions-and-law.html","title":{"rendered":"Maryland Bankruptcy Exemptions and Law"},"content":{"rendered":"\n
\n

Maryland Bankruptcy Exemptions and Law<\/h1>\n\n
\n
\n By Christie Nicholson, J.D.<\/a> | Legally reviewed by Catherine Hodder, Esq.<\/a>\n | Last updated\n
\n \n <\/i>\n Legally Reviewed\n <\/summary>\n\n
\n

This article has been written and reviewed for legal accuracy, clarity, and style by FindLaw\u2019s team of legal writers and attorneys<\/a> and in accordance with our editorial standards<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n\n

\n \n <\/i>\n Fact-Checked\n <\/summary>\n\n
\n

The last updated date refers to the last time this article was reviewed by FindLaw or one of our contributing authors<\/a>. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please contact an attorney in your area<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n<\/section>\n\n\n

\n
\n
\n

Key Takeaways<\/h2>\n

Maryland<\/span> bankruptcy exemptions allow individuals to eliminate dischargeable debts or create an affordable repayment plan<\/span> under federal and state law. Filers<\/span> primarily utilize Chapter 7 liquidation<\/span> or Chapter 13 reorganization to halt collection actions like garnishments through an automatic stay<\/span>. Debtors may protect essential equity in personal property<\/span> and home assets using state bankruptcy exemptions. Consulting an attorney ensures qualification and asset protection.<\/p>\n\n <\/div>\n <\/div>\n<\/div>\n\n

\n

For most people, filing bankruptcy<\/span> is a last resort that can offer a fresh start<\/span>. It can help with mounting debt and endless calls from creditors. While it\u2019s possible in a Chapter 7 <\/span>bankruptcy<\/span> case<\/span> that you could lose your home and other high-value assets, there are safeguards in place to help keep that from happening. While it\u2019s true that your Chapter 7 <\/span>bankruptcy<\/span> trustee<\/span> may attempt to sell your home to pay off your creditors, there are ways to protect the equity you have in your family\u2019s home.<\/p>\n

This article explains the state\u2019s bankruptcy laws<\/span>, including the bankruptcy exemptions available to you in the District of <\/span>Maryland<\/span>. It also shows you how to take advantage of the Maryland<\/span> homestead exemption<\/span>.<\/p>\n

If you\u2019re debating whether to file a Chapter 7 or Chapter 13 <\/span>bankruptcy<\/span> case<\/span>, contact a Maryland<\/span> bankruptcy lawyer<\/a>. They\u2019ll review your financial situation<\/span> and help you decide if bankruptcy is the best option for you.<\/p>\n

Types of Bankruptcy in Maryland<\/span><\/h2>\n

There are two main types of bankruptcy: Chapter 7 (liquidation<\/span> bankruptcy) and Chapter 13 (reorganization bankruptcy). Which type is best for you depends on your finances and income.<\/p>\n

If you\u2019re looking to eliminate your debt and start over, you\u2019ll want to file a Chapter 7 <\/span>bankruptcy<\/span> case<\/span>. If you meet the qualifications, you may have your debt discharged in full or in part. For those seeking a more affordable payment plan<\/span>, a Chapter 13 <\/span>bankruptcy<\/span> case<\/span> is a better fit. In a Chapter 13 bankruptcy<\/span>, you will present to the court a three-to-five-year repayment plan<\/span> that settles your debts with creditors.<\/p>\n

The benefit of a Chapter 7 case<\/span> is that you won\u2019t have to pay your creditors back once the bankruptcy judge discharges your accounts in bankruptcy. The main advantage of a Chapter 13 case<\/span> is that you will no longer be behind on your bills. You\u2019ll manage to avoid collection action, including possible foreclosure<\/span> and repossession<\/span>. Both will have a negative effect on your credit rating, with a Chapter 7 lasting longer and being more severe.<\/p>\n

Bankruptcy and the Automatic Stay<\/span><\/h2>\n

The moment the bankruptcy court<\/span> accepts your bankruptcy petition<\/span> and assigns it a case number, the automatic stay<\/span> takes effect. An automatic stay<\/span><\/a> is a court order<\/span> that prohibits your unsecured and secured creditors<\/span> from taking any collection action against you.<\/p>\n

Section 362 of the Bankruptcy Code<\/span><\/a> immediately stops adverse creditor actions like:<\/p>\n