Mistake #2 to AVOID Before Filing Bankruptcy: Not Knowing What You Can or Cannot Keep


Hi, my name is Lori Szathmary. I'm one of the attorneys here at Flex er Law. One of the mistakes that a lot of people make before they file bankruptcy is thinking that you may not be able to file because you might lose some of your personal property. Most times when you file for bankruptcy, we're able to exempt everything you own, which means that you may not actually risk losing any of your property.

Most of the cases filed in the state of Tennessee are what we call "No Asset" cases which means that none of your property is at risk When you file for bankruptcy, the most important thing you can do is list all of your personal property: everything that you own, whether it's tangible or intangible. Personal property that is tangible is going to be things like real estate, vehicles, furniture, money in bank accounts and that kind of thing. things you can actually, you know, reach out and touch. Things that are intangible are things like claims that you might have against someone or an inheritance that you might receive. For example, if you've recently been in a car accident and you haven't decided whether or not you should actually pursue the person that injured you in court, that is still an asset that you should list in your bankruptcy.

It's just an intangible asset. The main problem that a lot of people have is that they don't realize that these things could still be considered assets, and you may forget to let your attorney know about them. And when that happens, if we haven't properly exempted those assets under the Tennessee state law, then you might risk losing the things that you want to keep. and that would be the right to recover under a lawsuit, or some of your personal property (money in bank accounts), and that kind of thing. The state of Tennessee allows you some good exemptions in order to protect the property that you own. For example, for real estate, if you're a single person, then you're allowed to exempt $5,000 of the equity that you have in your real property. If you're married with children and you're filing a joint case, you can protect up to $50,000 of equity that you have.

Mistake #2 to AVOID Before Filing Bankruptcy: Not Knowing What You Can or Cannot Keep

There are also exemptions to protect your property if you're over the age of 62 or if you're married without children. These are all great things that you need to discuss with the attorney that you meet with in order to make sure that we're able to exempt all of the equity that you have in your property. As far as personal property, you get up to $10,000 of exemptions to protect the things that you own, like the equity in your vehicles, furniture, money in bank accounts…

Most of the time, even though it does't sound like a lot, it's plenty of exemption to protect everything that you own. Most of the time, when you file bankruptcy, none of your property is at risk. Most of the cases that are filed are what we call "no asset" cases. If there's a chance that you do have some property that is not exempted under the law of the state of Tennessee, then we may opt to file a Chapter 13 instead of Chapter 7, and that way you can protect all of the property that you own..

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