Identifying Which Assets Are Non-Divisible Assets – Bankruptcy Assets

Are you confused on what assets a bankruptcy can keep? The assets you can keep are otherwise referred to non-divisible assets. These bankruptcy assets are protected from the Trustee and most commonly include the following.

* Household items – this includes all necessary household items such as furniture, bedding, laundry equipment, sporting equipment, clothing and educational tools. It is important to place emphasis on the word necessary, a bankrupt with multiple televisions or expensive antique furniture will not be protected from the trustee to recover.

Debt counseling is for those consumers who are in the best shape. Credit consolidation is when all the credit card debt is combined together and there is one lower interest rate. The idea is that with less interest accruing on multiple cards, the payment will be smaller. All the debt will be paid back and no negative effect on the credit score will occur. The advantage to having a professional do the work is that you will end up with a lower interest rate meaning you will pay less money.

* Motor vehicles – these are vehicles with an equity value of $6,850 or lower. The vehicles need to be for primarily transport purposes. The equity values of the vehicles are regularly updated by the Insolvency Trustee Services Australia.

They do this by combining all the debt and making one monthly payment usually with a lower interest rate. By having a professional do the negotiating the consumer wins with lower interest rates. The professional will also help the consumer plan a budget that they can live within.

The typical settlement is around 50% but results vary case by case. As of October 27 2010, debt settlement companies are no longer able to collect upfront fees for their services. This means that if they can’t settle your debts, you don’t pay a single penny. This makes the process much more legitimate and an overall better deal for consumers.

Getting out of debt through a debt settlement process is currently very popular but you need to know where to locate the best performing programs in order to get the best deals.

* An asset held by you for another person – if you held assets in trust for another person e.g. your child’s education fund or your child’s bank account, the funds are exempt from the trustee to recover. We hope this article has given you a clearer understanding on which assets fall within this category of non-divisible bankruptcy assets.

Harris Smith is a personal finance writer interested in home equity line of credit Don’t Miss Out!

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