What can be repossessed during bankruptcy?

As you consider the benefit to filing bankruptcy, take into consideration which assets can be repossessed during the process. An asset is anything of value that you own. It could be an asset that is securing a loan, such as a mortgage or car. It could also be an asset that you own outright. When you file bankruptcy, you will list all of the assets you have on your bankruptcy declaration documents. The information must be accurate and thorough in order to be within the legal requirements of filing bankruptcy.

Repossession during Bankruptcy

Repossession occurs when a creditor takes back property because the borrower failed to make payments on the property as agreed. Repossession is not something done specifically by the bankruptcy courts. However, there are instances when a similar situation can occur.

• If you are behind on a loan, and you do not have any way of getting caught up on that loan, the lender can file a motion with the bankruptcy court to repossess the property. This occurs with homes, vehicles and other secured assets.
• If the court learns that you have assets that are over and above what the state allows you to maintain after bankruptcy, the court may seize those assets, sell them and use the funds from the sale to repay creditors.

Protecting assets is possible in many cases. However, if you have a large amount of assets, it may be best to file Chapter 13 bankruptcy instead.

Hire an Attorney

Hiring an attorney is almost necessary when you wish to protect your property. The attorney can help you to select the types of exemptions to do just that.