North Carolina Bankruptcy Guide

Complete guide to filing bankruptcy in North Carolina, including current median income requirements, North Carolina's homestead exemption up to $35,000 ($70,000 for married couples filing jointly), bankruptcy court information for all three NC districts, and how to find qualified bankruptcy attorneys throughout North Carolina.

North Carolina Median Income for Bankruptcy (2026)

To qualify for Chapter 7 bankruptcy in North Carolina, your household income must be below these median income levels. If your income exceeds these amounts, you may still qualify through the means test or need to file Chapter 13 instead.

Household Size	Annual Median Income	Monthly Median Income
1 person	$55,874	$4,656
2 people	$71,482	$5,957
3 people	$79,534	$6,628
4 people	$94,760	$7,897
5 people	$103,760	$8,647
6 people	$112,760	$9,397

Note: For households larger than 4, add $9,000 per additional person. These figures are updated annually by the U.S. Trustee Program.

Calculate Your North Carolina Eligibility

North Carolina Bankruptcy Exemptions

North Carolina allows bankruptcy filers to choose between North Carolina state exemptions and the federal bankruptcy exemptions. This choice can significantly impact which assets you can protect, so it's important to carefully compare both sets of exemptions with a North Carolina bankruptcy attorney.

North Carolina Homestead Exemption

Up to $35,000 (or $70,000 for married couples filing jointly).

North Carolina's state homestead exemption protects up to $35,000 of equity in your primary residence. If you are married and filing jointly, the exemption doubles to $70,000. This exemption applies to real property including houses, condominiums, mobile homes, and co-ops that serve as your primary residence.

The property must be your principal residence at the time of filing bankruptcy. The exemption covers the dwelling, outbuildings, and the land the home sits on up to the exemption limit.

Federal Exemption Alternative: North Carolina filers can instead choose the federal homestead exemption of $27,900 ($55,800 for married couples), which is lower than North Carolina's state exemption. For most homeowners, the North Carolina state homestead exemption is the better choice.

North Carolina Vehicle Exemption

Up to $3,500.

North Carolina allows you to protect up to $3,500 of equity in one motor vehicle under state exemptions. If you owe more than your vehicle is worth or have minimal equity, you can typically keep it by continuing to make loan payments through a reaffirmation agreement in Chapter 7 or through your payment plan in Chapter 13.

Federal Exemption Alternative: The federal vehicle exemption is $4,450, which is higher than North Carolina's state exemption. If you have significant vehicle equity, the federal exemptions may be better.

North Carolina State Exemptions

North Carolina bankruptcy exemptions include:

• Homestead: $35,000 ($70,000 for married couples filing jointly)
• Vehicle: $3,500
• Household Goods and Furnishings: $5,000 total plus $1,000 per dependent up to $4,000
• Personal Property: $5,000 total
• Clothing and Personal Belongings: Included in personal property
• Tools of Trade: $2,000
• Wildcard: $5,000 of any property (can be applied to any asset)
• Wages: Earned but unpaid wages due for services of the debtor
• College Savings Plan: North Carolina 529 education savings plan contributions made more than 1 year before filing

Federal Exemptions (Alternative Choice)

North Carolina filers may choose federal exemptions instead:

• Homestead: $27,900 ($55,800 for married couples)
• Vehicle: $4,450
• Household Goods: $700 per item, up to $14,875 total
• Jewelry: $1,875
• Tools of Trade: $2,800
• Wildcard: $1,475 general + up to $13,950 of unused homestead (total $15,425)

Which Exemptions Should You Choose?

Choose North Carolina state exemptions if:

• You have more than $27,900 equity in your home (state allows $35,000)
• You're married and have significant home equity (state allows $70,000 vs federal $55,800)
• You want the $5,000 wildcard for any property type

Choose federal exemptions if:

• You have little or no home equity and want the larger wildcard ($15,425 total)
• You have more than $3,500 equity in your vehicle (federal allows $4,450)
• You have significant household goods (federal allows $14,875 vs state $5,000-$9,000)

Other Protected Assets

• Retirement Accounts: Fully protected including 401(k), IRA, pension plans, and government retirement benefits under federal law
• Public Benefits: Social Security, unemployment, workers' compensation, veteran's benefits, disability benefits, crime victim's compensation
• Life Insurance: Cash surrender value up to $50,000 if beneficiary is spouse, child, or dependent
• Health Aids: All health aids prescribed by physician
• Personal Injury Awards: Compensation for personal injury (separate from homestead)
• Wrongful Death Awards: Proceeds for the benefit of surviving spouse or children

Filing Bankruptcy in North Carolina

Chapter 7 Bankruptcy in North Carolina

Chapter 7 bankruptcy is commonly filed throughout North Carolina. The process typically takes 3-4 months from filing to discharge and eliminates most unsecured debts including credit cards, medical bills, personal loans, and past-due utility bills.

To qualify for Chapter 7 in North Carolina, you must pass the means test by having income below the North Carolina median or by showing that after allowable expense deductions, you lack sufficient disposable income to fund a Chapter 13 repayment plan. You must also complete credit counseling from an approved agency within 180 days before filing.

North Carolina's choice between state and federal exemptions gives you flexibility to maximize asset protection. Work with a North Carolina bankruptcy attorney to determine which exemption set protects your specific assets better.

Learn more about Chapter 7 bankruptcy →

Chapter 13 Bankruptcy in North Carolina

Chapter 13 bankruptcy allows North Carolina residents to keep property while repaying some or all debts through a court-approved 3-5 year payment plan. This option is particularly beneficial if you're behind on mortgage or car payments and want to catch up while stopping foreclosure or repossession.

Chapter 13 is especially useful in North Carolina if your income is too high to qualify for Chapter 7, if you have non-exempt assets you want to protect (particularly if you have more than $35,000 in home equity as a single filer or $70,000 as a married couple), or if you have priority debts like recent taxes or past-due child support. Your monthly payment is based on your disposable income after allowable living expenses.

Learn more about Chapter 13 bankruptcy →

Bankruptcy Courts in North Carolina

North Carolina is divided into three federal bankruptcy court districts:

Eastern District of North Carolina

Main Courthouses: Raleigh, Wilson, Wilmington

Covers eastern North Carolina including Raleigh, Durham, Chapel Hill, Wilmington, Fayetteville, Greenville, and the eastern coastal region. This district handles bankruptcy cases for residents of the eastern portion of the state.

Court divisions: Raleigh Division (Wake, Durham, Orange, and nearby counties), Wilson Division (eastern counties), and Wilmington Division (southeastern coastal counties).

Middle District of North Carolina

Main Courthouses: Greensboro, Winston-Salem, Durham

Covers central North Carolina including Greensboro, Winston-Salem, High Point, Burlington, and the central Piedmont region. This district serves the most populous area of North Carolina.

Court divisions: Greensboro Division, Winston-Salem Division, and Durham Division.

Western District of North Carolina

Main Courthouses: Charlotte, Asheville, Shelby

Covers western North Carolina including Charlotte, Asheville, Gastonia, Hickory, Statesville, and the mountain region. Charlotte is the largest city in this district and handles a high volume of bankruptcy cases.

Court divisions: Charlotte Division (Mecklenburg and surrounding counties), Asheville Division (mountain counties), and Shelby Division (western Piedmont counties).

You must file in the district where you have lived for the greater part of the 180 days before filing. Visit the U.S. Courts website for specific court locations, filing procedures, and local rules for each North Carolina district.

North Carolina Residency Requirements

To use North Carolina bankruptcy exemptions (either state or federal), you must have been domiciled (legally residing) in North Carolina for at least 730 days (2 years) before filing. If you've lived in North Carolina for less than 2 years, you must use the exemptions from the state where you lived for the 180 days immediately before the 2-year period.

North Carolina allows you to choose between state and federal exemptions once you meet the residency requirement. This choice is made at the time of filing and cannot be changed later, so careful analysis with an attorney is important.

Find a North Carolina Bankruptcy Attorney

Most North Carolina bankruptcy attorneys offer free initial consultations. Given the complexity of bankruptcy law and North Carolina's choice between state and federal exemptions, consulting with an experienced North Carolina bankruptcy attorney is highly recommended.

What a North Carolina Bankruptcy Attorney Can Do

• Determine which bankruptcy chapter is right for your financial situation
• Compare North Carolina state vs. federal exemptions to maximize asset protection
• Calculate whether you qualify for Chapter 7 using the North Carolina means test
• Navigate North Carolina-specific bankruptcy procedures and local court rules
• Complete and file all required bankruptcy paperwork correctly
• Represent you at the 341 meeting of creditors
• Handle any objections from creditors or the bankruptcy trustee
• Guide you through the entire process from filing to discharge

Cost of Filing Bankruptcy in North Carolina

Chapter 7 bankruptcy attorney fees in North Carolina vary by location:

• Charlotte metro area: $1,200 to $1,800 plus $338 filing fee
• Raleigh-Durham area: $1,200 to $1,700 plus $338 filing fee
• Greensboro, Winston-Salem: $1,000 to $1,500 plus $338 filing fee
• Asheville, Wilmington: $1,100 to $1,600 plus $338 filing fee
• Other NC cities and rural areas: $900 to $1,400 plus $338 filing fee

Chapter 13 attorney fees typically range from $3,000 to $4,500 plus a $313 filing fee. In Chapter 13, attorney fees are usually paid through your repayment plan rather than upfront.

Many North Carolina attorneys offer payment plans for Chapter 7 to make bankruptcy more accessible.

North Carolina-Specific Bankruptcy FAQs

Can I keep my house in North Carolina bankruptcy?

It depends on your equity and whether you're married filing jointly. If you're single with up to $35,000 equity or married filing jointly with up to $70,000 equity, the North Carolina state homestead exemption protects your home. If your equity exceeds these amounts, you may need to file Chapter 13 to keep your home or consider federal exemptions with your attorney.

Can I keep my car in North Carolina bankruptcy?

Yes, in most cases. North Carolina allows you to exempt up to $3,500 of equity in one motor vehicle under state exemptions, or $4,450 under federal exemptions. If you owe more than your car is worth or have minimal equity, you can typically keep it by continuing to make payments through a reaffirmation agreement.

Should I choose state or federal exemptions in North Carolina?

It depends on your specific assets. Choose North Carolina state exemptions if you have significant home equity (up to $35,000 single or $70,000 married). Choose federal exemptions if you have little or no home equity but want a larger wildcard exemption (up to $15,425) to protect other property like cash, bank accounts, or equity in other assets. An attorney can help you compare both options.

How does bankruptcy affect my job in North Carolina?

Federal law prohibits employers from discriminating against employees solely because they filed bankruptcy. North Carolina is an at-will employment state, but firing someone specifically for filing bankruptcy is illegal under federal law. Government employers and private employers cannot use bankruptcy as a reason for termination or denial of employment.

What if I'm behind on my mortgage in North Carolina?

Chapter 13 bankruptcy is particularly effective for North Carolina homeowners facing foreclosure. You can catch up on missed mortgage payments over 3-5 years while keeping your home. The automatic stay stops foreclosure immediately upon filing, giving you time to reorganize your finances. Chapter 7 provides temporary relief but doesn't allow you to catch up on arrears.

Are HOA fees dischargeable in North Carolina bankruptcy?

Pre-filing HOA fees and assessments are generally dischargeable in Chapter 7. However, if you keep your home, you remain responsible for post-filing HOA fees. In Chapter 13, HOA arrears can be paid through your repayment plan while you stay current on ongoing fees. North Carolina has many HOA communities, especially in Charlotte, Raleigh, and coastal areas.

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