Many clients in the Riverside and San Bernardino areas are worried about keeping their assets in bankruptcy. Contrary to popular belief, filing bankruptcy does not automatically mean you will have to give up your home or your cars. On the contrary, many homeowners are able to keep their homes and their vehicles despite eliminating credit card debt, medical bill debt, payday loan debt, and other types of unsecured debt.
So how then can you tell whether or not you can keep your assets. Under the bankruptcy law, each state is given jurisdiction over assets that can be kept by debtors despite filing bankruptcy. These are called state exemptions. In California, there are two sets of exemptions. One set of exemptions is designed for those claiming a homestead with equity. If your home is worth more than you owe, you will likely want to use the homestead exemption to protect any equity. The other set of exemptions cover general assets such as vehicles, household items, and a wildcard exemption for any other type of property. The actual amounts and details about each set of exemptions can be found at the California bankruptcy exemptions page.
If you own a home but owe more than it is worth, it is unlikely the trustee will have any interest in the property. The reason for this is because once the trustee sells the home, there will be no money left for creditors once the home loan is paid. As a result, even if you own a home, you will not likely need to take the homestead exemptions because property values have dropped significantly in the last few years.
The same is true of cars. If you own a car and want to keep it despite filing bankruptcy, your bankruptcy attorney can exempt the vehicle so that the trustee cannot legally sell the vehicle to satisfy creditors. Further, if the car is still financed, our bankruptcy attorneys can prepare and file a reaffirmation agreement so that the lender will allow you to keep the car. A reaffirmation agreement is an agreement that survives the bankruptcy and obligates the debotr to continue making payments on the car loan despite filing bankruptcy. In return, the lender agrees to let the borrower keep and use the car and will not repossess the car once the automatic stay has lapsed.
Our bankruptcy lawyers can also help you reaffirm other secured debt that you want to keep. For instance, Best Buy maintains a security interest in many of its items. As a result, they will require the return of the items in bankruptcy or will negotiate a reaffirmation agreement. Oftentimes, these agreements provide much better terms and can save thousands over the life of the loan.
If you are struggling with the decision to file bankruptcy or worried that you may lose your assets, contact De Novo Law Firm for a free analysis and consultation at (951) 801-5570. De Novo Law Firm is composed of Riverside bankruptcy attorneys and has an A-rating with the Better Business Bureau. We offer a full money-back guarantee and we will beat any attorney’s price.