Qualifying For Bankruptcy: How A Pet Can Affect Your Chapter 7 Application

Most Americans consider their pets to be family and do not hesitate to splurge on pet's expenses. In fact, 56% of American households own at least one pet, and they collectively spent approximately $30.4 billion in 2014. Surprisingly, your pet's market value and expenses can actually affect your bankruptcy application. Here's how.

The Market Value of Your Pet

Technically speaking, your pet is considered as a personal property, and personal property must be surrendered to the bankruptcy trustee, who chooses whether or not to liquefy the assets surrendered to pay off creditors. Some states have specific exemptions for pets. For example, pets with a market value of up to $1,350 are exempt in Alaska. Other states have a wildcard exemption, which basically states that personal property can be exempt up to a certain value. In general, the market value of pets will be relatively low, so they are exempt.

In the event that you own an exotic pet that has a high market value, the bankruptcy trustee can choose to sell your pet in order to recover funds to pay back your creditors. Whether or not the pet will be sold will be up to the discretion of the trustee. In general, pets are considered exempt.

The Pet's Expenses and Chapter 7 Application

Although your pet will generally be considered exempt, your pet's expenses may affect whether or not you qualify for chapter 7. If you earn less than the median income of your state, you won't have to worry about your pet's expenses; however, in the event that you earn more than the median income of your state, your living expenses will need to be considered and reviewed by a judge.

In particular, you will have to list your pet's expenses. If your pet's expenses are deemed too high, you will have to explain your situation to a judge. If your pet's expenses are unusually high because of special circumstances, such as medical treatments for an on-going illness or therapy for a rescue animal, your pet's expenses may be deemed reasonable and necessary.

Expenses related to pet sitting services or dog walking services may be considered as unnecessary. In the event that your pet's expenses are considered to be too high by a judge, the bankruptcy trustee can file a motion arguing that you have too much disposable income to file for chapter 7. In this situation, your application will be denied, and you will have to resubmit your application for chapter 13 instead.


Talk with a bankruptcy attorney, like Attorney John A McLaughlin Jr PC, for more specific information. Having a pet can affect whether or not your bankruptcy application will be approved. Before you submit your application, determine whether or not your pet's expenses are too high. See if there are any minor adjustments that can be made, as this can affect your application status.