Ask 4 Pillars Debt Consultants What Assets You Can Keep in Bankruptcy

Filing for bankruptcy with a Licensed Insolvency Trustee gives you protection from your creditors and virtually all actions they can take against you to collect payment. However, it comes with a huge drawback: you will have to surrender some of your assets to a trustee. Your assets will then be liquidated to pay off your creditors and settle all your debts.

When bankruptcy is your only option, this is an unfortunate reality you have to live with. It is worth noting, though, that there are federal laws in place to prevent your creditors from taking advantage of your situation. Debt consultants from 4 Pillars in Victoria, Nanaimo, Port Alberni, and Courtenay can help you determine which of your assets may need to be given up to the trustee and also consult with you on other options to deal with your debt. 

Common Exempted Assets

 

Under the Bankruptcy and Insolvency Act, you are entitled to keep some assets. Usually, the government will allow you to keep your possessions if they consider such items as reasonable living expenses. This is so you can support yourself after your bankruptcy has been discharged. In general, debtors can hold on to their clothing, personal items, tools necessary for their vocation, pets, necessary food items, household furniture, equipment in their personal home, motor vehicles with values up to a certain limit, select farm properties, and home equity.

If you applied for Registered Retirement Savings Plans, what you have already saved is also exempt from bankruptcy. Take note, however, that contributions made in the twelve months before bankruptcy are not. Meanwhile, your retirement savings are also exempt in case of legal debt or if your creditors try to seize your assets during debt settlement. 

Exempted Assets Specific to British Columbia

 

Each province also has the right to establish bankruptcy exemptions for their residents. For instance, if you live in British Columbia, you will have to be aware of specific details regarding what assets you are allowed to keep.

In BC, residents can keep $4,000 worth of household furnishings and goods, $5,000 worth of motor vehicle equity, $10,000 worth of vocational tools, $9,000 worth of home equity ($12,000 for Victoria and Vancouver), and all medical devices.

The amounts that are exempt in a bankruptcy can change from time to time, so be sure to check for any updates while you are in the process of filing for bankruptcy. Better yet, work with a debt relief specialist from a reputable company like 4 Pillars. Professionals with experience in handling debt and solely representing the interests of the debtor can give you more details to better protect your assets and what to accept when working with a Licensed Insolvency Trustee.