What can I maintain when I’m Bankrupt – The bankruptcy means test.
Any time individuals stress over Bankruptcy, they fret about just how it will impact their day-to-day lives, and whether they will be able to keep their home, car, tools, and other essential belongings.
One of the ways that we can figure this out is by using the insolvency means test. It is something that we take our clients through to present 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 key area of concern with Bankruptcy in Canberra as there is normally an unreasonable fear that someone will come along to your home to take all your stuff away, retrieve your couch, television, even the coffee machine. But this is never ever going to be the case with pure insolvency since typically they don’t care about these possessions. There are a couple of interesting exemptions although with Bankruptcy and belongings so if you have distinct concerns about this make sure that you get a bit of guidance first or contact us here at Bankruptcy Experts Canberra on 1300 795 575.
With Bankruptcy you might be impacted if you have pricey tools. The guidelines specify that you may retain tools of trade up to a limit of $3,700. However remember that this is based upon ‘current cost’ therefore if you purchased your tools for $8,000 5 years before, they are most likely to be worth far less right now. So it is worth considering just how much you would expect them to be valued at, or how much you could receive for all of them if you had to sell them. But as a whole, the government doesn’t want bankruptcy to become a barrier to you doing your job, so they don’t want to refuse you accessibility to your equipment. It is quite a great part of Bankruptcy, but sometimes could be complex. Therefore when it relates to tools of trade, you do not need to worry just call us here at Bankruptcy Experts Canberra for some advice.
People are constantly troubled about just how Bankruptcy will impact their vehicle. So the rule is that you can retain one vehicle or motorcycle up to the value of $7,600.
This takes into consideration current value, and also the equity. What does this mean? Well, equity deals with the amount of money you have actually put into the car, and how much is on a 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 debts. On the other hand, if you got a vehicle loan for that amount instead then there would be no benefit to selling off your motor vehicle.
How do you value your car? Easiest way is to simply have a chat to a used car dealership and ask just how much they would offer you for it– that will certainly give you a rough idea about how your vehicle will be affected by this Bankruptcy procedure. After that you just need to take into consideration the value 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 levels get some help, at Bankruptcy Experts Canberra we assist people work through their options when it relates to cars.
The Family Home
Just like with Bankruptcy and motor vehicles, the approach that will be taken to your home will certainly be dependent upon equity. When there is no equity in your home, then there is no purpose in forcing you to sell it. If there is absolutely no money to be made by taking the house off you, then they are hardly ever going to bother. For instance if you own a home worth $400,000 and you owe the bank $400,000 then more than likely you will be able to keep your residential property after insolvency.
The worst part about all this though is that personal bankruptcy does not think about feelings or justifications– you will not merely have the ability to manage to keep your automobile or residence because you ‘need it’ or because you have a strong emotional attachment. Bankruptcy can be cruel, but that is why you need to make sure you speak with the right people. Don’t jeopardize your family home by assuming or wishing you will have the ability to maintain it post-bankruptcy because you need to dwell somewhere.
If you are stressed out over your home or any other aspect of this Bankruptcy Means Test, then call us at Bankruptcy Experts Canberra on 1300 795 575 if you would like to know more about Bankruptcy and Houses or almost anything to do with Bankruptcy. We are here to really assist you. Visit our website for even more information, www.bankruptcyexpertscanberra.com.au.
We offer a Free- No Commitment Consultation so contact us today 1300 795 575.