Filing Chapter 7 Bankruptcy in Delaware (2026)
Reviewed by DocDraft Legal Team · Delaware · Last updated August 18, 2026
Chapter 7 bankruptcy is federal law, but the property you keep is set by Delaware. Delaware is an opt-out state: under 10 Del. C. 4914 a debtor domiciled in Delaware must use Delaware's exemptions and cannot elect the federal 522(d) list. This page explains Delaware's homestead exemption for a principal residence, the aggregate personal property, vehicle, and tools-of-trade figures, the means-test median income, and the single federal district where Delawareans file. Chapter 7 discharges most unsecured debt but not most student loans, recent taxes, or child and spousal support.
Does Delaware use state or federal bankruptcy exemptions?
Delaware is an opt-out state. Under 10 Del. C. 4914, an individual debtor domiciled in Delaware is not entitled to elect the federal 522(d) exemptions and may exempt only the property allowed by Delaware law. You use the Delaware exemption set in full and cannot substitute the federal list for it.
Can I keep my house if I file Chapter 7 in Delaware?
Often yes. Under 10 Del. C. 4914, equity in the real property or manufactured home that is your principal residence is exempt up to an aggregate $200,000. If your home equity fits within that amount, Chapter 7 generally lets you keep the house. Delaware had no homestead exemption at all before 2013.
Can I keep my car if I file Chapter 7 in Delaware?
Usually yes. Under 10 Del. C. 4914, a motor vehicle necessary for employment is exempt up to $25,000, and tools of the trade are separately exempt up to $25,000. If your vehicle equity is at or below that figure, the car is protected. Equity above the cap may be reachable by the trustee.
What is the income limit to file Chapter 7 in Delaware?
For cases filed on or after July 15, 2026, the U.S. Trustee median income figures for Delaware are $69,515 for one earner, $94,877 for two, $111,273 for three, and $132,244 for four, adding $11,100 per additional person. At or below your household figure, you pass the first part of the means test.
Delaware's Opt-Out Rule, the 10 Del. C. 4914 Homestead, and the District of Delaware Court
Delaware is a bankruptcy opt-out state. Under 10 Del. C. 4914, an individual debtor domiciled in Delaware may not elect the federal 11 U.S.C. 522(d) exemptions and may exempt only the property Delaware law allows. Delaware's exemptions are notable because for most of its history the state had no homestead exemption at all; a principal-residence homestead was not added until 2013. Today section 4914 exempts equity in the real property or manufactured home that is your principal residence up to an aggregate $200,000. It also exempts personal property and non-residence real property up to an aggregate $25,000, which functions as a broad wildcard, plus a motor vehicle necessary for employment up to $25,000 and tools of the trade up to $25,000. Wages are 85 percent exempt under 10 Del. C. 4913, and retirement plans are exempt under 10 Del. C. 4915. Delawareans file in a single court, the U.S. Bankruptcy Court for the District of Delaware, which despite its fame as a corporate venue also handles consumer Chapter 7 cases for residents who have lived in the state for most of the prior 180 days.
Relevant Laws
Delaware Exemptions in Bankruptcy and Opt-Out (10 Del. C. 4914)
The statute governing Delaware's opt-out from the federal exemptions. It bars a Delaware-domiciled debtor from electing the federal 522(d) list and sets the state exemptions: a $200,000 principal-residence homestead, a $25,000 aggregate personal property exemption, and a $25,000 vehicle and tools-of-trade exemption.
Delaware Exempt Property (10 Del. C. 4902)
Delaware's general exempt-property statute, listing personal property such as tools of trade, household furniture, and other items protected from execution. It works alongside the section 4914 aggregate exemptions that apply specifically in bankruptcy and insolvency proceedings.
Delaware Wage Exemption (10 Del. C. 4913)
Exempts 85 percent of a debtor's earned wages from attachment, limiting a creditor to at most 15 percent. This is the wage protection that continues to shield income when a Delaware debtor files Chapter 7 and the automatic stay stops garnishment.
Federal Bankruptcy Code Exemptions and Means Test (11 U.S.C. 522, 707)
The federal law behind Chapter 7. Section 522(b)(2) lets a state opt out of the federal 522(d) exemptions, which Delaware has done, and section 707(b) sets the means test measured against state median income.
Regional Variances
Delaware Chapter 7 Exemption Table
Homestead
10 Del. C. 4914: equity in the real property or manufactured home that is your principal residence is exempt up to an aggregate $200,000. Delaware had no homestead exemption before 2013. The exemption can be limited if the debt arose from securities fraud or certain intentional wrongdoing in the prior five years.
Motor vehicle
10 Del. C. 4914: a motor vehicle necessary for the purposes of employment is exempt up to $25,000. Equity above that figure may be reachable by the trustee. This vehicle exemption applies in addition to the aggregate personal property exemption.
Wildcard / personal property
10 Del. C. 4914: personal property and equity in real property other than the principal residence are exempt up to an aggregate $25,000 fair market value. This broad aggregate functions as Delaware's wildcard and can be applied to cash, household goods, or other assets.
Tools of trade
10 Del. C. 4914: tools of the trade necessary for the purposes of employment are exempt up to $25,000, separate from the vehicle exemption. Delaware's general exempt-property statute, 10 Del. C. 4902, also protects specified tools and implements from execution.
Wages
10 Del. C. 4913: 85 percent of a debtor's earned wages are exempt from attachment, so a creditor can generally reach no more than 15 percent. Wages already earned remain protected, and the Chapter 7 automatic stay halts garnishment on dischargeable debts once you file.
Retirement
10 Del. C. 4915: assets held or payable under a retirement plan, life insurance contract, or annuity contract are exempt from execution and attachment, and an eligible rollover distribution keeps its exempt status for 60 days. ERISA-qualified plans are separately excluded from the bankruptcy estate under federal law.
Suggested Compliance Checklist
Confirm the current Delaware means-test median income
Before you file days after startingCheck your household size against the U.S. Trustee Delaware median income figures in effect on your filing date, since these update periodically. For cases filed on or after July 15, 2026 the figures are $69,515 for one, $94,877 for two, $111,273 for three, and $132,244 for four, adding $11,100 per additional person.
Complete the pre-filing credit counseling course
Within 180 days before filing days after startingTake an approved credit counseling course from a provider authorized for the District of Delaware and keep the certificate. You must file it with your petition. Skipping this can get your case dismissed before your debts are addressed.
Value your assets against the Delaware exemptions
Before preparing your schedules days after startingDelaware is opt-out, so apply the 10 Del. C. 4914 state exemptions: up to $200,000 for a principal residence, $25,000 for aggregate personal property, and $25,000 each for a work vehicle and tools of the trade. Value your home, vehicle, and personal property to match assets to exemptions.
Prepare and file your petition and schedules
Filing day days after startingFile your petition, schedules, and exemption claims in the U.S. Bankruptcy Court for the District of Delaware, based on where you have lived for most of the prior 180 days. Filing triggers the automatic stay that pauses collection and garnishment.
Attend the 341 meeting and finish the debtor education course
Before discharge days after startingAttend the 341 meeting of creditors and answer the trustee's questions under oath, then complete the required post-filing financial management course and file the certificate. Both are required before the court will grant your discharge. An attorney can help with contested exemptions.
| Task | Description | Document | Days after starting |
|---|---|---|---|
| Confirm the current Delaware means-test median income | Check your household size against the U.S. Trustee Delaware median income figures in effect on your filing date, since these update periodically. For cases filed on or after July 15, 2026 the figures are $69,515 for one, $94,877 for two, $111,273 for three, and $132,244 for four, adding $11,100 per additional person. | - | Before you file |
| Complete the pre-filing credit counseling course | Take an approved credit counseling course from a provider authorized for the District of Delaware and keep the certificate. You must file it with your petition. Skipping this can get your case dismissed before your debts are addressed. | - | Within 180 days before filing |
| Value your assets against the Delaware exemptions | Delaware is opt-out, so apply the 10 Del. C. 4914 state exemptions: up to $200,000 for a principal residence, $25,000 for aggregate personal property, and $25,000 each for a work vehicle and tools of the trade. Value your home, vehicle, and personal property to match assets to exemptions. | - | Before preparing your schedules |
| Prepare and file your petition and schedules | File your petition, schedules, and exemption claims in the U.S. Bankruptcy Court for the District of Delaware, based on where you have lived for most of the prior 180 days. Filing triggers the automatic stay that pauses collection and garnishment. | - | Filing day |
| Attend the 341 meeting and finish the debtor education course | Attend the 341 meeting of creditors and answer the trustee's questions under oath, then complete the required post-filing financial management course and file the certificate. Both are required before the court will grant your discharge. An attorney can help with contested exemptions. | - | Before discharge |
Frequently Asked Questions
Under 10 Del. C. 4914, equity in the real property or manufactured home that serves as your principal residence is exempt up to an aggregate $200,000. Delaware notably had no homestead exemption before 2013. Section 4914 also limits the homestead where the debt arose from securities fraud or certain intentional wrongdoing in the prior five years.
Under 10 Del. C. 4914, personal property and equity in real property other than your principal residence are exempt up to an aggregate $25,000 fair market value. This broad aggregate acts as Delaware's wildcard, letting you apply it to cash, household goods, or other assets. A separate motor vehicle and tools-of-trade exemption applies on top of it.
Yes, largely. Under 10 Del. C. 4913, 85 percent of your earned wages are exempt from attachment, so a creditor can generally reach only 15 percent. In Chapter 7 the automatic stay stops most wage garnishment on dischargeable debts once you file, and wages you have already earned remain protected under section 4913.
No. Chapter 7 discharges most unsecured debt like credit cards and medical bills, but it does not erase most student loans, recent income taxes, child support, or spousal support, and it will not discharge debts from fraud. Secured debts like a car loan remain unless you surrender the collateral or reaffirm the loan.
Generally yes. Under 10 Del. C. 4915, assets held or payable under a retirement plan, life insurance, or annuity contract are exempt from execution and attachment, and an eligible rollover keeps its exempt status for 60 days. ERISA-qualified plans are also excluded from the bankruptcy estate under federal law, so most retirement savings are safe.
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