do i have to get rid of all my assets for bankruptcy in california?
If I file for bankruptcy do they make you get rid of all your assets even if they are not paid off?
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In Ch 7 bankruptcy all your NON-EXEMPT assets are liquidated to pay creditors. This ("non-exempt") is important because 97% of all consumer Ch 7 bankruptcies have no assets that are non-exempt for the trustee to liquidate.
What can be exempted depends upon your state laws. Some states use the Federal exemptions, some states have their own set of exemptions, and some states (CA included, I think) give the debtor the choice of using either the state or Federal exemptions (but you need to pick one or the other; you can’t "combine" them into a hybrid).
In general, it is much easier to exempt assets with a perfected lien (i.e., used as collateral for a secured loan for money to purchase them) because you have little equity in them. So (for example) if you still owe $15,000 on your car and your car is currently worth $16,000, you only have $1000 worth of equity in the vehicle which needs to be exempted. If that same vehicle were paid off, you would have to be able to find $16,000 worth of exemptions with which you could exempt your equity in it.
If you file Ch 7 bankruptcy and still owe money on secured assets (usually house & car) which you intend to keep, you need to (a) be current on your payments to the secured creditor at the time you file, and (b) reaffirm the loan and keep making payments on it. Your other choice is to surrender the asset and be discharged of whatever you may owe on it (i.e., you no longer owe it). There is a third option which is less frequently used: the option to "redeem" secured assets.
Many people worry that their clothing, furniture and personal effects will be "taken" by the bankruptcy trustee to repay creditors. Not so. Unless you are a millionnaire and have hundreds of thousands of dollars worth of designer clothing and expensive original artwork, your clothing and personal effects can usually be exempted (meaning, you get to keep them).
A bankruptcy attorney licensed in your state can go over all the options with you and discuss the pros and cons of each. Most bankruptcy attorneys offer one free appointment to discuss your options in your particular situation in your particular state. Make an in-person apoointment with a local bankruptcy attorney and take advantage of the free (or very low cost) appointment to get answers to your questions about how bankruptcy would affect your particular situation, and what bankruptcy options are available to you.
The only asset they will take to help pay your creditors are ones that are paid off. Best thing to do is speak with an attorney.