What to do with excess assets

More and more debtors are coming in who are either cash heavy or asset heavy. Generally speaking, in a bankruptcy, you can have about 11k in cash or cash equivalents. Any more and you risk the trustee taking the asset to pay creditors or you paying the court for the privilege of keeping the excess money/assets.

So what do you do with the excess? One thing you can do is let the trustee sell it. This is a good choice if you have a difficult to sell asset. You won’t be able to keep it, but you will probably get some money from it.

Another option would be to sell it yourself and convert the cash into exempt assets. If you do sell it yourself, make sure you get fair market value for the property and keep track of what happened to the money. Don’t spend it or pay back debts (doubly so for family debts) without talking to an attorney first. We can help guide you into what assets would be exempt in the bankruptcy.

Lastly, you can pay the trustee to keep the asset. The trustee would prefer you give him the cash value of an asset rather than having to actually sell it. The trustee may even give you a discount to avoid having to sell an asset. So if you have exempt assets (like retirement) or have someone willing to give/loan you money, you can just pay the trustee a lump sum or over 3 to 5 years (in a chapter 13 bankrutpcy)

But always remember the bankruptcy adage, pigs get fat, hogs get slaughtered. Get too greedy and the court will have the final say.

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