What can I keep when I’m Bankrupt – The bankruptcy means test.

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What can I keep when I’m Bankrupt – The bankruptcy means test.

Whenever people stress over Bankruptcy, they think about just how it will affect their day-to-day lives, and whether they will be able to keep their house, car, tools, and other essential possessions.

One of the ways that we can figure this out is by utilizing the bankruptcy means test. It is something which we take our clients through to show them how they may or may not be affected, and what Bankruptcy will mean to them.

Personal and household items

Your valuables are always going to be a key area of concern with Bankruptcy in Northern Rivers since there is normally an unreasonable concern that someone will arrive to your property to swipe all your stuff away, retrieve your couch, the television, even the coffee machine. But this is never going to hold true with pure insolvency since often they do not care about these valuables. There are a few interesting exemptions though with Bankruptcy and belongings so if you have individual worries about this make sure that you get some guidance initially or contact us here at Bankruptcy Experts Northern Rovers on 1300 795 575.

Tools.

With Bankruptcy you could be impacted if you have high priced tools. The guidelines explain that you may keep tools of trade up to a limit of $3,700. However bear in mind that this is based upon ‘current cost’ and so if you bought your tools for $8,000 5 years ago, they are most likely to be worth far less right now. So it is worth considering how much you would anticipate them to be valued at, or how much you could receive for all of them if you needed to sell them. But overall, the government doesn’t want bankruptcy to become a barrier to you working, so they do not want to deny you access to your tools. It is quite a good part of Bankruptcy, but sometimes can be complicated. So when it relates to tools of trade, you do not have to worry just contact us here at Bankruptcy Experts Northern Rovers for some suggestions.

Cars

People are always worried about just how Bankruptcy will impact their motor vehicle. So the rule is that you can easily retain one car or motorcycle up to the market value of $7,600.

This takes into account present value, as well as the equity. What does this mean? Well, equity deals with the amount of money you have actually put into the automobile, and just how much is on a loan. If you have bought a car for $10,000 without a loan, then the car can likely be sold for that amount, and $10,000 could be raised to pay off your bankruptcy liabilities. However, if you got a vehicle loan for that quantity instead then there would be no benefits to selling your motor vehicle.

How do you value your car? Easiest method is to simply have a chat to a second hand car dealer and ask just how much they might give you for it– that will certainly present you a rough idea about how your car will be affected by this Bankruptcy procedure. Then you just have to think about the value of your vehicle loan or financing plan, and whether you are below or over the $7,600 threshold.

If your car is worth greater than these threshold quantities get some assistance, at Bankruptcy Experts Northern Rovers we help people work through their options when it relates to cars.

The Family Home

Similar to with Bankruptcy and motor vehicles, the approach that will be taken to your home will certainly be dependent upon equity. In case there is no equity in the house, then there is no use in forcing you to sell it. If there is absolutely no funds to be earned by taking the house from you, then they are hardly ever going to bother. As an example if you own a house worth $400,000 and you owe the bank $400,000 then more than likely you will be able to maintain your home after insolvency.

The worst part about all this though is that insolvency does not think about emotions or justifications– you will not simply be able to manage to keep your car or house because you ‘need it’ or because you have a powerful emotional attachment. Bankruptcy may be harsh, but that is why you will need to make sure you speak with the right people. Do not risk your family home by presuming or wishing you will have the ability to maintain it post-bankruptcy just because you have to live somewhere.

If you are stressed over your home or any other component of this Bankruptcy Means Test, then call us at Bankruptcy Experts Northern Rovers on 1300 795 575 if you would like to know more about Bankruptcy and Houses or almost anything to do with Bankruptcy. We are here to truly support you. Visit our website for a lot more information, www.bankruptcyexpertsnorthernrivers.com.au.

We offer a Free- No Commitment Consultation so get in touch with us today 1300 795 575.

By | 2018-08-01T01:53:54+00:00 January 10th, 2017|Bankrupt, Blog|0 Comments

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