Over the last decade or so it would be fair to say that bankruptcy has been something that has become much more common. While the economy has shown some really encouraging signs over recent times, this has only arrived following immense turmoil which has meant that Philadelphia bankruptcy attorneys have been overflowing with work.
If you have concluded that bankruptcy might have to be the route for you as well, it’s worth arming yourself with four pieces of information that are essential prior to your application. Any bankruptcy court will demand that you provide a list of assets and any outstanding debts, with each of these categories split down into two areas. We will now take a look at all four of these areas to help you along with the bankruptcy process if you feel the need has arisen.
Exempt assets
One of the first things that your attorney will ask you is for an entire list of your assets. The first type we are going to look at is the exempt assets.
As the name suggests, these are assets that won’t be turned to in a bid to clear your debts. A lot of people are surprised at what falls into this category and dare we say it, they are sometimes relieved. They mainly include any personal items that you have – with this stretching as far as your home and vehicle. In other words, you won’t be losing your home as part of your bankruptcy proceedings.
Non-exempt assets
This next list will probably be of more interest to most of you. This is the list of assets that can be used to repay any debts you have, so it’s effectively the type of assets that you will lose after your bankruptcy proceedings have concluded.
If you own any other properties, these can be confiscated to pay for the debts although again, this doesn’t include your primary residence. If you happen to own any recreational vehicles these can be taken as well.
Secured debts
The other information that the attorney and courts will ask you for is debts. The first type are any secured debts that you have, meaning that the creditor could have some interest in some of your existing assets.
These are regarded as the most important form of debt, for the simple reason that the courts can quickly allow creditors to lay claim on properties and recoup money owed via this approach.
Non-secured debts
As you may have probably guessed by now, the next form of debt is of the non-secured variety. These are debts which don’t have any property associated with them, meaning that they are more appealing for you during bankruptcy proceedings.
In truth, a lot more debts are of this variety, and the list could go on and on. Common examples include debts accrued from the likes of credit cards, medical bills or even just a standard unsecured loan.
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