Your Assets and the Bankruptcy Process

When someone faces bankruptcy, often the first question is, “Will I become homeless?” It’s understandable to be worried about that, as well as worried about what will happen to their other assets. If you’re facing bankruptcy, the following are some things you should know about your assets during the process.

A Trustee Will Be Appointed

Once you have been declared bankrupt, the court will appoint a trustee to take control of your assets. It will be the trustee’s job to supervise the process of you paying off as many debts as possible. This is most often done by selling assets. The trustee could have some ideas that you may not have come up with on your own, so it’s important to trust him or her with the process.

You Can Keep Certain Assets

When it comes to bankruptcy, you can keep certain assets that are necessary to your job and your life. For example, the trustee isn’t going to sell your bed and your baby’s crib, but if you have some highly-valued antiques in a room that never gets used, the trustee may sell those furniture pieces.

If you have a grand piano because your kids take music lessons, you might have to sell the piano. However, if you’re a professional musician who plays for special events, that piano would be essential to your employment. You would probably be able to keep the piano in that case.

In many cases, you can also keep your home. If you’ve been able to stay current on your mortgage and there isn’t really a whole lot of equity, many trustees will allow you to keep the home. If you’re facing foreclosure, or if you have a large amount of equity, there’s a chance you would need to sell the home. You might also have to sell if you have a vacation home you could earn money from.

Your Credit and Bank Accounts Might Get Frozen

In many cases of bankruptcy, your credit cards and bank accounts will be frozen for a period of time. You will still have access to the amount of money you’ll need to buy groceries and pay your utility bills, but if you think you’ll be able to put something frivolous on credit, you should think again.

Contact a Lawyer to Help You Through Bankruptcy

It can be difficult to deal with bankruptcy on your own. There are a lot of legal terms you’ll have to learn, and you may not understand what is going to happen to your assets. Contact a lawyer, like a bankruptcy lawyer from Darrell Castle and Associates, PLLC, to get some questions answered and to set up an appointment to discuss your personal situation.