In a no-asset Chapter 7 bankruptcy case, the person filing for bankruptcy keeps all of their property because it falls within the exemptions provided under federal law or the law in their state.
With a Chapter 7 liquidation bankruptcy, a filer surrenders their assets to the bankruptcy estate, which uses them to pay off creditors. But in reality, this is only true of non-exempt property. Many of our cases, are in fact, ‘no asset’ cases. Bankruptcy law recognizes that filers need to retain some property so they can survive the process with something on which to build a future after bankruptcy.