How to Legally Protect Your Assets in Bankruptcy
Bankruptcy can help you legally keep your assets without having creditors seize your property to satisfy an overdue balance or outstanding debt. Some people believe that they need to withhold information about their property to keep it. Hiding information can lead to heavy fines, bankruptcy fraud charges, and even imprisonment. Honesty is the best policy. You should avoid hiding or withholding details from the beginning, even before you start the process. Honesty about your situation will provide you with the advantages of the legal process that will allow you to protect your assets worry-free.
Property Protection in Bankruptcy:
- Learn what assets can be protected in your bankruptcy. There are several exemptions available to assist you in legally protecting your property. Many people believe that they can protect those assets by hiding or withholding information regarding their property. However, the key is knowing exactly what assets and the amount of value you can protect. Bankruptcy helps protect these common assets: vehicles, homes, retirements, cash on hand, jewelry, and more. If you file as a business owner, some business assets may also be protected.
- Know what exemptions are available. Each state has a set amount of exemptions to protect various assets. It is important to know how much protection each exemption offers for a particular asset. Additional protection may also be available through exemptions at the federal level.
- Provide full disclosure of your assets and property to your attorney or trustee. Prior to filing a bankruptcy case, it is important that you provide full disclosure of your current and expected assets or property. If you are expecting something, for example, proceeds from a legal settlement, an inheritance, or tax refund, you have the opportunity to discuss and review your available options to protect your expected or future property. Disclosing expected or future assets with your attorney will give you an opportunity to create a plan for the best way to move forward regarding your particular situation and expected future assets.