Georgia Bankruptcy Filers Should Avoid Transferring Property
If you are considering filing bankruptcy in Atlanta, Georgia, you should be cautious about transferring property prior to filing bankruptcy. One of the most frequently asked questions regarding bankruptcy is whether a debtor can keep his assets, including his home, car, and retirement savings after filing bankruptcy. The answer depends on the value of the assets and the amount of protection that Georgia bankruptcy laws give to certain assets. Even if some assets may not be protected, the worst action that a debtor can take is transferring assets or selling assets before filing bankruptcy.
When a debtor transfers an asset that he or she owns free and clear to a third party prior to filing Chapter 7 bankruptcy, the transfer can be reversed by the bankruptcy trustee. For example, if a debtor transfers $10,000 to his mother prior to filing bankruptcy, then the transfer could be reversed by what is called an “avoidance action” by the trustee. Such action is based on a claim that the transferred money belongs to the bankruptcy estate and was made in order to avoid liquidation.
Rather than transferring assets in fear of losing them in Chapter 7 or Chapter 13, those who are considering bankruptcy in Atlanta, Georgia should consult a bankruptcy lawyer in order to protect assets using the allowable bankruptcy laws rather than risk losing the assets by making illegal transfers.
If you have questions about how to keep your property in bankruptcy, call the Law Offices of Charles Clapp at 404.585.0040 to schedule a consultation.