Any time people worry about Bankruptcy, they fret about just how it will impact their day-to-day lives, and if they will be able to retain their house, car, tools, and other important belongings.
One of the ways that we can figure this out is by using the insolvency means test. It is something which we take our clients through to demonstrate to them just how they may or may not be affected, and what Bankruptcy will signify to them.
Personal and household items
Your valuables are always going to be a crucial aspect of concern with Bankruptcy in Frankston because there is often an illogical fear that someone will arrive to your home to swipe all your stuff away, repossess your couch, the television, even the coffee machine. But this is never ever going to hold true with pure insolvency because often they do not care about these valuables. There are a few intriguing exemptions though with Bankruptcy and belongings so if you have individual worries about this make sure that you get some advice initially or get in touch with us here at Bankruptcy Experts Frankston on 1300 795 575.
With Bankruptcy you could be impacted if you have pricey tools. The guidelines specify that you may keep tools of trade up to a limit of $3,700. Having said that keep in mind that this is founded upon ‘current cost’ so if you bought your tools for $8,000 5 years before, they are likely to be worth far less right now. So it is worth thinking about just how much you would anticipate them to be valued at, or how much you could obtain for them if you needed to sell them. But as a whole, the government doesn’t want bankruptcy to be a barrier to you working, so they do not want to refuse you access to your tools. It is quite a great component of Bankruptcy, but sometimes might be complicated. So when it relates to tools of trade, you don’t need to stress simply call us here at Bankruptcy Experts Frankston for some suggestions.
Individuals are always worried about how Bankruptcy will impact their motor vehicle. So the guideline is that you can retain one vehicle or motorcycle up to the market value of $7,600.
This takes into consideration present value, and also the equity. What does this mean? Well, equity deals with the amount of money you have essentially put into the vehicle, and just how much is on a car loan. If you have bought a car for $10,000 without having a loan, then the car can potentially be sold for that amount, and $10,000 could be raised to pay off your bankruptcy liabilities. On the other hand, if you had a car loan for that quantity instead then there would be no advantage to selling off your motor vehicle.
How do you value your car? Simplest method is to simply have a chat to a used car dealer and ask how much they would offer you for it– that will give you a rough idea regarding how your vehicle will be impacted by this Bankruptcy method. At that point you just need to think about the worth of your vehicle loan or financing plan, and whether you are below or over the $7,600 threshold.
If your car is worth greater than these threshold amounts get some help, at Bankruptcy Experts Frankston we help people work through their possibilities when it relates to cars.
The Family Home
Just like with Bankruptcy and motor vehicles, the approach that will be taken to your house will certainly depend on equity. When there is no equity in your house, then there certainly is no use in forcing you to sell it. If there is zero funds to be made by taking the house from you, then they are hardly ever going to bother. For instance if you own a house worth $400,000 and you owe the financial institution $400,000 then more than likely you will be able to retain your house after bankruptcy.
The worst part about all this though is that personal bankruptcy does not take into consideration feelings or justifications– you will not just be able to always keep your vehicle or house because you ‘need it’ or considering that you have a strong emotional attachment. Bankruptcy can be harsh, but that is why you need to ensure you talk to the right people. Do not jeopardize your family home by presuming or hoping you will have the capacity to keep it post-bankruptcy because you have to live somewhere.
If you are stressed over your house or any other aspect of this Bankruptcy Means Test, then call us at Bankruptcy Experts Frankston on 1300 795 575 if you wish to know more about Bankruptcy and Houses or almost anything to do with Bankruptcy. We are here to really help you. Visit our website for a lot more information, www.bankruptcyexpertsfrankston.com.au.
We offer a Free- No Commitment Consultation so get in touch with us today 1300 795 575.