For most people who file for bankruptcy, their biggest concern involves the protection of their assets. When filing for a Chapter 7, debtors want to ensure that they can keep their possessions as they seek a fresh financial start. Working with a Fort Worth bankruptcy attorney can help you maximize your exemption planning to ensure that your home, car, and other assets are safe during the course of your bankruptcy. With these exemptions in place, you’ll be on your way to a fresh financial start without worrying about the loss of your valuable assets.
Your Assets In Chapter 7
After you file for Chapter 7 bankruptcy, your creditors will seek to liquidate whatever assets they can to make up the debt difference. A bankruptcy attorney can help you avoid mistakes and enhance your efforts. Remember the following considerations as you protect your assets through exemption:
- Don’t transfer your assets. One of the most common mistakes that people make is transferring their assets to a trustee or loved one to avoid it being taken away during a bankruptcy. This is a costly legal mistake that has the opposite consequences of what you’re trying to avoid. Furthermore, omitting assets and trying to hide them during the Chapter 7 filing is illegal and prosecutable under law. A bankruptcy attorney can help you determine what is exempt and help you protect it. There is no need for shady actions.
- Homestead exemptions are complicated. Protecting your assets from a Chapter 7 filing varies from state to state. In bankruptcy, there is unlimited homestead exemption for those living on 10 acres or less if the property is in a city or town and 100 acres or less for a property in the country. This is covered in Article 16, Sections 50 and 51 of the Texas Constitution. Again, a bankruptcy attorney can help you navigate through homestead, motor vehicle, and personal property exemptions.
- Be prepared for denial. While rare, exemptions claimed by the debtor can be denied by the court if they’re inapplicable. This is why working with a bankruptcy attorney is so crucial – so that you make accurate exemption claims and correctly represent your situation.