Delaware significantly expanded its bankruptcy exemptions effective January 1, 2025 — the vehicle and tools-of-trade allowances jumped from $15,000 to $25,000 each, and a new $25,000 general personal property exemption replaced what used to be a much smaller catch-all. For filers weighing whether to move up a bankruptcy filing, these changes are recent enough that older online guides may still show the outdated, lower figures.
How Chapter 7 Works in Delaware
The process follows federal bankruptcy law: file a petition, a trustee reviews your assets against Delaware’s exemption list, and anything not covered is technically available to pay creditors. Most Delaware Chapter 7 cases are “no-asset” cases — the exemptions cover everything the filer owns, and the case closes with a discharge roughly three to four months after filing.
How Much Home Equity Can You Protect in Delaware?
Delaware’s homestead exemption protects $125,000 in home equity. Not doubled for married couples filing jointly. That figure is more modest than some neighboring states, so homeowners with substantial equity should run the numbers carefully before assuming full protection.
Does Delaware Let You Choose Federal Exemptions Instead?
No. Delaware is an opt-out state, so filers must use Delaware's own exemption list. Delaware substantially increased several of its exemptions effective January 1, 2025. Given how much Delaware’s own vehicle and personal property exemptions expanded in 2025, this is now a more competitive system than it used to be relative to the federal alternative.
What Happens to Your Car in a Delaware Chapter 7?
Delaware exempts $25,000 in equity in one vehicle (increased from $15,000 effective January 1, 2025). In joint cases, each spouse gets their own $25,000. That’s a substantial increase from the prior $15,000 figure, meaning most Delaware filers now keep their vehicle fully protected regardless of value.
What Is Delaware’s Wildcard Exemption?
Delaware’s personal property exemption is $25,000 in personal property or equity in real property other than your principal residence - a new, expanded allowance effective January 1, 2025, replacing a much smaller prior exemption. In joint cases, each spouse gets their own $25,000. This new, expanded allowance gives Delaware filers far more flexibility than the state’s old exemption system did — cash, bank balances, and miscellaneous property that doesn’t fit another category now have real room to be protected.
Do You Qualify for Chapter 7 in Delaware? The Means Test
Delaware’s current median income figures:
- 1 person: $69,515
- 2 people: $94,877
- 3 people: $111,273
- 4 people: $132,244
- Each additional person: add $11,100
Which Federal District Do You File In?
District of Delaware - a single statewide district, with all filings and hearings handled through the Wilmington courthouse or electronically.How Much Does a Bankruptcy Attorney Cost in Delaware?
Chapter 7 attorney fees in Delaware typically run $935 to $1,800, on top of the 338 federal filing fee. Unlike Chapter 13, Chapter 7 fees generally have to be paid in full before filing.
Common Mistakes Delaware Filers Make
Relying on outdated exemption figures. Delaware’s vehicle, tools-of-trade, and personal property exemptions all increased substantially on January 1, 2025 — older guides may still cite the previous, lower amounts.
Not accounting for the modest homestead exemption. Compared to Delaware’s newly generous personal property allowance, the $125,000 homestead is relatively modest and worth checking carefully against your actual home equity.
Overlooking a non-filing spouse’s income in the means test.
Not confirming joint-case exemption doubling for vehicles and personal property, which each spouse can claim separately.
A Realistic Example
Consider a filer we’ll call Julia, living in Newark. She works in pharmaceutical logistics and owns her home with about $95,000 in equity, plus a car worth $19,000 with no loan remaining.
Delaware’s $125,000 homestead exemption fully covers her home equity. Her $19,000 vehicle falls comfortably under the newly expanded $25,000 vehicle exemption — a gap that wouldn’t have been fully covered under the old $15,000 limit. Her attorney confirms both major assets are fully protected under the current exemption amounts.
Her income falls below Delaware’s median for a household of one, so she qualifies for Chapter 7 automatically. She files, attends the 341 meeting, and receives her discharge about ninety days later.
Frequently Asked Questions About Chapter 7 Bankruptcy in Delaware
Can I keep my house if I file Chapter 7 in Delaware?
Usually, if your equity is under $125,000. This amount isn’t doubled for married couples filing jointly. Equity above that isn’t automatically protected.
Does Delaware allow federal bankruptcy exemptions?
No. Delaware is an opt-out state, so filers must use Delaware’s own exemption list. Federal exemptions aren’t available.
How much car equity can I protect in Delaware bankruptcy?
$25,000 per vehicle as of January 1, 2025, up from $15,000 previously. In joint cases, each spouse can claim their own $25,000.
Did Delaware’s bankruptcy exemptions recently change?
Yes. Effective January 1, 2025, Delaware increased its vehicle and tools-of-trade exemptions from $15,000 to $25,000 each, and introduced a new $25,000 general personal property exemption that didn’t exist in the same form before.
What is the Delaware bankruptcy means test income limit?
It depends on household size and updates periodically. Current thresholds are roughly $69,515 for one person, $94,877 for two, $111,273 for three, and $132,244 for four, with $11,100 added per additional person.
Which bankruptcy court handles my case in Delaware?
Delaware has a single statewide bankruptcy court, the District of Delaware, with filings and hearings handled through the Wilmington courthouse or electronically.
Where to Verify the Details
Delaware’s exemption statute is published at Del. Code tit. 10, § 4914. For current means test figures, check the U.S. Trustee Program website. Filing information is available through the District of Delaware bankruptcy court.
Alternatives to Chapter 7 in Delaware
If your income is too high to pass the means test, Chapter 13 bankruptcy in Delaware restructures debt into a three-to-five-year repayment plan instead of liquidation.
Last reviewed by American Debt Guide Editorial Team. Figures on this page reflect Delaware bankruptcy exemption amounts and federal filing data as of July 2026.