When people think about bankruptcy and how filing a case will impact their property, one of two thoughts is likely. The first is that you can file a case and keep all of your stuff without paying, and the second is that if you file for bankruptcy you will not be able to keep anything. These are two extremes, and neither is accurate. If you need to file bankruptcy to eliminate or reduce your debt load, you do have to follow the rules, but that does not mean you will lose everything you have. But, it also does not mean that you will get a free ride and get to keep things without repayment.
Here is an example of some of the things you can keep if you file bankruptcy:
• Your house.
• Your car.
• Your personal belongings.
• Pieces of artwork or antiques.
• Boats and RV’s.
• A motorcycle.
• The furniture in your house, including electronics.
In order to keep these things though, you do have to keep making the payments. If there is no payment due, you will not be required to begin making payments, but for collateral you have financed the lender is entitled to receive either payment or return of the goods. This is most typically done by signing a reaffirmation agreement, which is like a new contract for the item. You will be expected to make payments pursuant to the terms of the reaffirmation agreement and those terms might mirror the original contract repayment terms, or you might be able to negotiate a lower payment. For things like televisions and computers that are not yet paid off, you may or may not be asked to reaffirm those items. Most times this type of collateral is bought on a store credit card, and while technically the store has an interest in the property, the value may be such that the store will not undertake efforts to repossess your laptop, even if you don’t repay the credit card. This can get confusing, but we can help you sort it out so you can decide if bankruptcy is right for you. Also keep in mind that the way debts are treated are not the same in a Chapter 7 as they are in a Chapter 13 case. In a Chapter 7 all debt not reaffirmed is eliminated, but in a Chapter 13 you will have to repay part of your unsecured obligations.
For more information about Chapter 7 and Chapter13 bankruptcy cases, and to find out what you can keep and what you have to give back if you file a case, contact us at www.DsouzaLegalGroup.com.
