Don't Let Your Assets Go Up In Smoke: How A Bankruptcy Attorney Can Help

When you think of filing bankruptcy, it's natural to wonder whether you can protect your assets like your home, car, and other valuables before you do so. The simple answer is yes, but the protection varies depending on your financial situation and the kind of bankruptcy you decide to file. If you have questions about how to protect your assets in the event of bankruptcy, don't hesitate to contact an experienced bankruptcy attorney who can help ensure that everything goes smoothly throughout the process. How can they protect your assets?

1. Identify Your Primary Residence

If you have equity in your home, you may be able to use it as collateral against your debt. In most cases, bankruptcy law protects primary residences up to a certain amount. If you own more than one property and are unsure which is protected, be sure to disclose all of them with your bankruptcy attorney so they can advise which one(s) may be safe from seizure.

2. Specify Personal Property To Exempt

You'll be able to keep your home and some personal property by filing for Chapter 13 bankruptcy. However, even if you don't own any real estate, you may consider adding an exemption for small business property such as inventory and equipment. The attorney will advise on personal items exempted from bankruptcy. 

3. Shield Your Retirement Accounts

Make sure your 401(k) and other retirement accounts are protected from creditors if you declare bankruptcy. If you're married, be sure to protect your spouse's retirement assets. In most cases, a bankruptcy attorney can take care of everything for you; sometimes, all it takes is a simple form your lawyer can file with either the state or federal government. 

4. Shield Work Equipment, Tools, and Machinery

The bankruptcy procedure gives you a chance to breathe and reorganize your finances. It does not aim to make you destitute. Your lawyer can help keep your livelihood by shielding your tools, equipment, machinery, and vehicles from creditors. If they have been repossessed, the attorney will work hard to get them back into your possession after filing for bankruptcy protection.

5. File a Stay on Creditors

If you have creditors at your door, it's crucial to act fast and take steps to protect yourself. By filing for bankruptcy, your creditors can no longer attempt to contact you or collect payment from you. Any action they take after your bankruptcy is legally null and void. Once your bankruptcy petition has been filed and approved by a court, your assets are protected as long as they remain in your possession.

The biggest worry about filing for bankruptcy is asset loss, but it doesn't have to come to that. Contact a bankruptcy attorney to discuss how to keep your life relatively normal during a bankruptcy proceeding.