If you are a debtor in need of financial assistance, you may need to file for Chapter 7 to Chapter 13 bankruptcy. Chapter 7 bankruptcy is the liquidation of a debtor’s assets. This means that you will need to sell your possessions in order to cover the costs of your debts and pay back the creditors who are asking for compensation. The money from your estate sales will go straight to creditors and pay any debts that have been approved by the bankruptcy court. The other type of bankruptcy that most debtors can file is a Chapter 13 bankruptcy. This type of bankruptcy involves drafting a strict repayment plan. All of your debts will be consolidated into the payment plan and an attorney will help you to come up with a monthly commitment which you will make to pay back your debts.

In a Chapter 13 bankruptcy, finances are normally very tight for a few years as the debtor works hard to pay off expenses and get a fresh new start in life. No matter what type of bankruptcy you are going to undertake, it is expressly illegal to transfer any properties right before filing for bankruptcy. Some people want to do this so that they will not need to list the property as an asset and lose it in a Chapter 7 bankruptcy or have to accommodate for it in a Chapter 13 bankruptcy. Yet this practice is illegal.

If you try to transfer property right before or during a bankruptcy, then the court will have the right to reverse the order. If you want to transfer a piece of property before the bankruptcy ensues, then you will need to decide what chapter of bankruptcy you wish to file and will want to consult with a lawyer. Your attorney will give you instructions to avoid transferring any property to anyone before you file for bankruptcy. If you admit that you filed for bankruptcy and then transferred property or transferred the property right before, then your lawyer will have the fiduciary duty to report your crime to the courts.

If you truly want to transfer property under honest pretenses, you can do so as long as you have a one-year buffer between the time that the property as transferred and the time that you file for bankruptcy. To transfer your property, you will more than likely have two options. You can either sell the property or you can give it as a gift. If the gift is large, then you will want to consult a tax attorney and it will affect your yearly return. To transfer some properties, you may need to sign away titles to property, vehicles, or bank accounts.

You will probably need to file documents with the county clerk or the Secretary of State regarding the assets that you are transferring and you will want to make sure to keep receipts and copies of any title transfer documents. Make sure that you do not attempt to file for bankruptcy for at least one whole year. Once your year-long limit is up, you can file for bankruptcy. At this point, an attorney or trustee will most likely ask you if you have transferred anything of value within the past year. In most courts, anything over $1,000 is considered an item of value. If you have, then the transfers may be reversed. In these cases, the item that you tried to transfer will become a part of your bankruptcy estate. If you file for a Chapter 7 bankruptcy, then the item may be liquidated. If you need more information about transferring properties before bankruptcy, then contact a local bankruptcy attorney for more information!