Bankruptcy Planning And Asset Protection
At O’Bryan Law Offices, we understand that bankruptcy is a major step in your life. Over the last 20 years, thousands of clients have placed their trust in our law firm. With this level of bankruptcy experience, we know that proper planning for bankruptcy can protect your assets and maximize your debt relief. Before you file for bankruptcy, there are a number of steps you should take.
Secured vs Unsecured Debts
Find out which of your debts are secured and which are unsecured. Secured debts are those debts that are backed, or secured, by collateral. Your home and your car are examples of secured debts. Unsecured debts are not backed by collateral. Typically, credit cards and medical bills are unsecured debts. Secured debts are not discharged in Chapter 7 bankruptcy unless you decide to surrender the collateral, such as a vehicle or home. Most unsecured debts are dischargeable. The nature of your debts will have a great impact on the type of bankruptcy you file.
Take inventory of your assets. This is helpful for a number of reasons. First, when filing bankruptcy, you are required to fully disclose your assets and liabilities. Taking inventory of what you own will help in this regard. Secondly and more importantly, certain classes of assets cannot be taken from you to satisfy your creditors. If you understand which of your assets are exempt and which are not exempt, you will have a greater understanding as to which type of bankruptcy is in your best interests.
401K, IRA and Other Pension Plans
Continue to make contributions to your 401(k), IRA or other pension plans. These assets are generally exempt from bankruptcy with certain exceptions. Therefore, in most instances, any money you place in these accounts cannot be taken by the bankruptcy trustee.
Act sooner rather than later. The earlier you plan for bankruptcy, the more options you will have. The more options you have, the more leverage you will have with your creditors. Planning for bankruptcy includes hiring a lawyer. O’Bryan Law Offices can provide invaluable counsel during this time.