When you have accumulated an overwhelming amount of debt and see no way to pay it down, filing for bankruptcy can be a path to consider. Typically in a bankruptcy, a part or all of your debts may be discharged and there are several different options, known as chapters, for which a person can file. In exchange, you agree to pay what you can to your creditors through the sale of your assets or a multi-year repayment plan. After the bankruptcy is complete, you will be given a new financial start. But what happens if you simply do not have any assets?
Can You File For Bankruptcy With No Assets?
Yes, you can still liquidate assets in Chapter 7 Bankruptcy even if you don't have a lot of assets or property. Your bankruptcy trustee will have to declare a no-asset bankruptcy and those creditors cannot make claims on your property or assets to pay your debts.
"No Asset" Bankruptcy in Indiana
In Indiana, debtors who are pursuing bankruptcy but do not own any assets may be able to file for Chapter 7 Bankruptcy. Under Chapter 7, your unsecured debts will be discharged and a bankruptcy trustee will be assigned to your case to see that your creditors receive any possible payment. When you do not have any assets, there will be nothing for the trustee to sell for creditor payment and your debts will be discharged just the same. This is known as a no asset bankruptcy, however, many people may not realize the extent of possessions which can be legally taken and sold by the state.
Assets are not just physical possession such as the money in your bank account, but can also include non-physical items such as any debts that are owed to you. Luckily, the state cannot just take the items you do possess and it is vital to understand which of your assets are exempt from repossession and sale. For example, all or a part of a car or property may be exempt and if the value of what you own falls under this amount, you are allowed to keep your possessions.
When filing for Chapter 7 bankruptcy, debtors must complete a detailed petition about their financial situation, go through credit counseling from an approved agency, and pass a "means" test. The means test will determine your financial eligibility for chapter 7 bankruptcy, and while not everyone will qualify, those with no assets generally meet financial guidelines. An experienced attorney can consult with you and help to understand what to expect when you file a chapter 7 bankruptcy.
Considering Bankruptcy? Call (888) 713-5148
The choice to file for bankruptcy is never easy and every financial option must be carefully considered before proceeding. The first step in pursuing a chapter 7 bankruptcy is to meet with an attorney from our firm to discuss your financial options and eligibility. At Jackson & Oglesby Law LLC we understand the stress of incurring an unsurmountable about of debt and can work with you towards securing your financial freedom.
Are you ready to pursue a life free of debt? Schedule a free consultation with our firm today!