Sometimes in bankruptcy doing the honestly right thing can cause you major problems. Making preference payments is a good example of this.
Chapter 7 “asset” cases may sound scary. They needn’t be. We walk you through a very straightforward example to demystify this.
Most Chapter 7 cases are “no-asset” ones. So, what’s an “asset case,” and is it good or bad for you?
Just because you own something that’s not exempt doesn’t always mean that the Chapter 7 trustee will take it. The trustee could abandon it.
Most individual consumer Chapter 7 cases are “no asset” ones. This means that the Chapter 7 trustee doesn’t liquidate any debtor assets.
Assets acquired after filing under Chapter 7, such as wages, can’s be reached by the trustee. But watch out for proceeds, rents and profits.
The 180-day rule also applies to marital property division, whether by agreement or court decree.
The 180-day rule applies to life insurance proceeds in a Chapter 7 case. But life insurance proceeds are often exempt, or protected.
If you are expecting an inheritance, or even if you are not, the special rules about them are worth your attention to prevent bad surprises.
If you have a power of attorney over someone’s assets, or any similar power, those assets are not affected by your bankruptcy case.
To find out if you can keep everything you own in a Chapter 7 case, the first step is finding out what’s in your bankruptcy estate.
You hear in bankruptcy about the “trustee,” and maybe about the “U.S. Trustee.” They’re clearly easy to confuse. Who’s the U.S. Trustee?
There’s a lot more to using property exemptions than just matching them to your assets. There are benefits worth taking advantage of.
Most of the time you get to keep everything you own when you file bankruptcy. It’s all covered by property exemptions. But not always.
Usually you use the property exemptions available for the residents of your state. But not if you haven’t lived there long enough.