Bankruptcy is something that you enter after you’ve exhausted all other possibilities for filing. It’s not an easy process to go through, but the end result is one of being free from your debts. While bankruptcy helps you eliminate your bills, it does not take away everything you own, despite the urban legends that say otherwise. The designers of bankruptcy law recognized that people still need to maintain their lives, and that includes being able to keep assets with modest value. There are two ways in which this is achieved in an Aurora bankruptcy.
A section of the bankruptcy code is known as exemptions. They are laws that allow you to set aside certain assets and keep them from being sold by the trustee. Selling of assets is done only in Chapter 7, and only when the non-exempt assets are of sufficient value. An Aurora bankruptcy is done at the federal level, but it defers to the state law for setting the exemptions and how much is allowed per each item. Valuing items should be done at a resale price, IE what it would be sold for in a garage sale, as opposed to a retail value. This is done for household items, electronics, clothing and any other items that wouldn’t fetch much if it were to be sold. An older car with little asset value can also be exempted, provided there is proof of its resale value provided.
There are times when assets are not covered by the exemptions. This can be a car with an outstanding balance owed on it or a home with a mortgage. The court is rarely interested in these items because there is money owed on them. Selling them would not benefit anyone, and the petitioner is free to renegotiate or confirm the loan in order to maintain the payments at their current level. In the event that the payments are too high, an attorney can negotiate with the lender to get more favourable terms and lower the payments for the client.
If you are in need of debt relief, contact the law office of Ledford and Wu today. A consultation with an attorney gives you the opportunity to learn about your available options.
