When filing for bankruptcy protection, you are able to discharge or restructure a good part of your debt. Each type of filing, either Chapter 7or Chapter 13, has restrictions on assets you can keep. Your credit record will also be somewhat impacted by the filing, although will start to improve as time passes from the date you filed. With the advice of a knowledgeable San Antonio bankruptcy attorney from the Malaise Law Firm, you can rest assured that your best interests will be forwarded when filing your bankruptcy petition.
While Chapter 7 bankruptcy allows you to discharge almost all debts with the exception of exempted debts such as property tax or IRS taxes, any assets you own will be liquidated by the federal court to offset any creditor losses. You must turn over any property to the Bankruptcy Trustee, who will sell it to satisfy the creditors. Many times there are few assets available to liquidate over the exempted assets you are allowed to keep. Below are listed assets you may lose in a Chapter 7 bankruptcy.
- Recreational vehicles
- Second cars
- Your primary residence, if you have been unable to maintain your mortgage payments. If you are current on your payments and can continue to make payments, you will likely be allowed to keep it.
- A second home or land.
- Any inheritance received within 6 months of filing bankruptcy
- Any cash on hand or checking or savings accounts are usually taken in Chapter 7 bankruptcy proceedings except for a minimal set amount you are allowed to keep.
Chapter 13, as it allows for restructuring of your debt, does not seize your assets as long as you complete your repayment plan. However, if you fail to complete the repayment plan, you could lose some assets. In general, these are the main points that would affect you when filing a Chapter 13:
- All available income must be used for repayments of your debts.
- You will pay higher legal fees for a Chapter 13 due to its complexity.
- Limits of debt that can be restructured must be under $1,000,000., with no more than $250,000 in unsecured debt and $750,000 in secured debt.
- You will be tied to a strict repayment plan for 3 to 5 years, depending on how you restructured it in the petition.
- You are involved in the bankruptcy court process for the entire term of the 3-5 year plan, until all debts are paid.
Protect Your Property with a San Antonio Bankruptcy Attorney
To get more details as to exactly how bankruptcy exemptions would impact you, it is best to meet with a skilled and dedicated bankruptcy lawyer from the Malaise Law Firm. Having helped numerous clients in the San Antonio area, we are certain we can assist you with the financial assistance you need to handle your debt situation. We offer a free consultation to discuss your specific circumstances.