What can I keep when I’m Bankrupt – The bankruptcy means test.
Whenever individuals stress over Bankruptcy, they fret about how it will impact their day-to-day lives, and if they will be able to retain their house, vehicle, tools, and other essential belongings.
One of the ways that we can figure this out is by using the insolvency means test. It is something that we take our clients through to show them exactly how they may or may not be impacted, and what Bankruptcy will signify to them.
Personal and household items
Your belongings are always going to be a key area of concern with Bankruptcy in Newcastle as there is usually an irrational concern that someone will arrive to your property to swipe all your stuff away, retrieve your couch, the television, even the coffee machine. However this is never going to be the case with pure bankruptcy since often they do not care about these valuables. There are a couple of intriguing exemptions although with Bankruptcy and belongings so if you have particular worries about this make sure that you get some guidance initially or contact us here at Bankruptcy Experts Newcastle on 1300 795 575.
With Bankruptcy you might be affected if you have high priced tools. The guidelines specify that you may keep tools of trade up to a limit of $3,700. Having said that remember that this is founded upon ‘current cost’ therefore if you purchased your tools for $8,000 5 years ago, they are likely to be worth far less these days. So it is worth thinking about just how much you would anticipate them to be worth, or how much you could get for them if you had to sell them. But as a whole, the government doesn’t want bankruptcy to be a barrier to you doing your job, so they don’t want to refuse you accessibility to your equipment. It is quite a good part of Bankruptcy, but sometimes could be confusing. Therefore when it relates to tools of trade, you do not have to stress simply call us here at Bankruptcy Experts Newcastle for some advice.
Individuals are constantly concerned about how Bankruptcy will affect their vehicle. So the rule is that you can easily retain one car or motorcycle up to the value of $7,600.
This takes into account current value, and also the equity. What does this mean? Well, equity deals with the amount of money you have essentially put into the car, and just how much is on a car loan. If you have bought a car for $10,000 without a loan, then the car can likely be sold for that quantity, and $10,000 could be raised to pay off your bankruptcy liabilities. Having said that, if you had a vehicle loan for that amount instead then there would be no advantage to selling your car.
How do you value your car? Easiest method is to just have a chat to a used car dealership and ask just how much they would provide you for it– that will certainly provide you a rough idea regarding how your car will be impacted by this Bankruptcy procedure. After that you just have to think about the worth of your car loan or financing plan, and whether you are below or above the $7,600 threshold.
If your car is worth more than these threshold amounts get some assistance, at Bankruptcy Experts Newcastle we assist people work through their possibilities when it relates to cars.
The Family Property
Similar to with Bankruptcy and motor vehicles, the approach that can be taken to your home will depend on equity. When there is no equity in your home, then there certainly is no point in forcing you to sell it. If there is no money to be made by taking the house off you, then they are rarely going to bother. For instance if you own a house worth $400,000 and you owe the financial institution $400,000 then more than likely you will have the ability to retain your house after bankruptcy.
The worst part about all this though is that personal bankruptcy does not think about emotions or justifications– you will not just have the ability to always keep your vehicle or residence because you ‘need it’ or considering that you have a powerful emotional attachment. Bankruptcy can be harsh, but that is exactly why you will need to ensure you speak with the right people. Don’t risk your family home by assuming or hoping you will have the capacity to maintain it post-bankruptcy just because you need to dwell somewhere.
If you are anxious over your home or any other aspect of this Bankruptcy Means Test, then call us at Bankruptcy Experts Newcastle on 1300 795 575 if you want 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 even more information, www.bankruptcyexpertsnewcastle.com.au.
We provide a Free- No Commitment Consultation so contact us today 1300 795 575.