Do you have some special possession you want to keep in bankruptcy? Because you probably can.

corvetteIs there some special heirloom you have or a piece of furniture you like or do you have an old car that you just can’t lose?  Maybe you own an old jewelryclassic ’57 Chevy or Corvette that you want to fix up someday.  You may have a great number of debts which you realize you can’t afford to pay but you are worried about the safety of your favorite possessions if you do file for bankruptcy.

The good news is that you probably can keep these possessions as long as the property’s value is less than the exemptions allowed in bankruptcy.  In bankruptcy law there are very liberal exemptions and these exemptions are what allow you to keep property after the bankruptcy is over.

One very helpful exemption is something called the “wildcard” exemption that you can use to protect any kind of property that you own.  At the time of this writing the wildcard exemption is $26,425.00 and that is pretty generous.

There are other exemptions besides the wildcard.  There is one for your car, and one for your furniture, clothes, and household items.  There are separate exemptions for cars, jewelry, and tools of the trade and don’t worry about you retirement account because that is almost certainly exempt.  Your attorney can advise you about all of the applicable exemptions in your state.

Your property will fit within the wildcard exemption as long as your property is worth less than $26,425.00.  If it does then you can keep it.  To value the property you want to go to a website like Kelly Blue Book for cars or you can go to Ebay or even Craig’s list to see what items similar to yours are selling for.

To get a more accurate valuation of the property you can hire an estimator or property appraiser who, if you pay him, will give you his or her valuation of the property.  If the property is of a special nature like a record collection then a property estimator who owns a record store could do the valuation.  The same thing applies for jewelry or a stamp collection, or an old gun from the civil war (jewelry even has its own separate exemption).  There is usually someone out there who can accurately value your property whatever the type.

valueRemember the bankruptcy trustee can only take your property if it has a value beyond your exemptions.  This is why it is so important to establish the fair market value of the item(s).  So if you (and your bankruptcy attorney) show the trustee that the fair market value is less than the exemption amount that you claim then you will usually be okay.

It is possible that the trustee can get his own valuation which could be higher than yours but if you get a reliable appraiser for the property you can usually defend your appraisal.  It is always good to consult with a bankruptcy attorney if you have any questions about whether you can keep your property in bankruptcy and if you should or should not file bankruptcy.

I am a San Diego bankruptcy attorney.  For further questions please visit my websites at www.farquharlaw.com or www.freshstartsandiego.com.  Or call my office for a free consultation or for any other advice about bankruptcy or debt at (619) 702-5015. Call now for free credit report and analysis!

For a free e-book on “13 things to do to prepare for your bankruptcy filing” please e-mail me at farquharesq@yahoo.com.

Corvette by Zombieite.  Jewelry photo courtesy of Gnilenkov Aleksey.

Go ahead and file bankruptcy! What are you waiting for? Those debts don’t get any better with age!

Debts are not like wine.  They get much worse with age.  All sorts of fees, penalties, attorney costs, and other costs get added to them including interest.  The total amount owed can double or even triple in size.  As time goes on even more and more money is owed to these creditors.

The creditors will not go away either.  This is something that I continually warn my clients about.  They will continue to sell you debt and increase it as it goes.  Debt collection is one of the biggest industries in this country because it is so profitable.  It is also the one that is complained about the most to government agencies because of alleged abusive practices.

Collection agents are not nice people as you may have experiences first hand.  They don’t care what you problems or limitations are.  You may be on your death-bed or so disabled that you are completely unable to work.  When you tell the collectors that they will not care in the least and they will just demand that you pay them unreasonably high payments.  They will tell you to go borrow the money.  They have told disabled clients of mine just to pay immediately or they will sue them.

If one agency gives up on you then they will sell it to another and another.  They will never go away and always come after you.  They will ring you phone hundreds of times a day.  They will fill your mailbox with bills.

Eventually they will sue you in court.  You probably will not go to court or answer (most people don’t) and they will get a default judgment against you.  Now they can collect anytime they want.  They can lien homes, garnish wages, take your bank accounts or even get you into court for a debtor’s exam.  All of these things are bad, unpleasant and to be avoided.

Bankruptcy can end all this nonsense though and it is the only way I know to get out of these debts short of paying these people.  If you don’t have the money then paying is out of the question and that only leaves bankruptcy.  It may be time to admit this fact and begin to look into filing.  Bankruptcy will stop all collection efforts and stop these collectors from calling or suing or garnishing or liening or taking any other action to collect your debt.  (See here for additional reasons for why you should file for bankruptcy).

After your discharge you no longer owe the debt.  It’s a wonderful happy feeling on that day.  So think about it, call a bankruptcy attorney, and begin considering the real possibility of escaping your debts before they drown you.

Please visit my website for more blogs and really good bankruptcy information at www.farquharlaw.com or www.freshstartsandiego.com.   Or call my office for a free consultation at (619) 702-5015.  For my e-book, 13 things you should do to prepare for bankruptcy, e-mail me at farquharesq@yahoo.com.