Any time individuals worry about Bankruptcy, they fret about how it will affect their day-to-day lives, and if they will be able to retain their house, vehicle, tools, and other important possessions.
Among 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 present to them exactly how they may or may not be impacted, and what Bankruptcy will signify to them.
Personal and household items
Your belongings are always going to be a crucial area of concern with Bankruptcy in Perth as there is usually an unreasonable fear that someone will come out to your home to snatch all your stuff away, repossess your couch, television, even the coffee machine. However this is never ever going to be the case with pure bankruptcy because typically they don’t care about these belongings. There are a few interesting exemptions although with Bankruptcy and belongings so if you have specific concerns about this make sure that you get some advice first or get in touch with us here at Bankruptcy Experts Perth on 1300 795 575.
With Bankruptcy you might be impacted if you have high priced tools. The guidelines specify that you may keep tools of trade up to a limit of $3,700. However keep in mind that this is founded upon ‘current cost’ therefore if you bought your tools for $8,000 5 years before, they are likely to be worth far less today. So it is worth considering just how much you would anticipate them to be worth, 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 personal bankruptcy to be a barrier to you doing your job, so they don’t want to refuse you access to your tools. It is quite a great part of Bankruptcy, but sometimes can be complicated. Therefore when it relates to tools of trade, you really don’t have to worry just call us here at Bankruptcy Experts Perth for some advice.
Individuals are always troubled about how Bankruptcy will impact their car. So the rule is that you can easily keep one car or motorcycle up to the value of $7,600.
This takes into account present value, as well as the equity. What does this mean? Well, equity deals with the sum of money you have actually put into the automobile, and how much is on a car loan. If you have purchased a car for $10,000 without a loan, then the car can potentially be sold for that amount, and $10,000 can be raised to pay off your bankruptcy liabilities. However, if you got a car loan for that amount instead then there would be no benefit to selling your vehicle.
How do you value your car? Easiest way is to just have a chat to a second hand car dealer and inquire just how much they would offer you for it– that will present you a rough idea about how your motor vehicle will be affected by this Bankruptcy procedure. At that point you just have to consider 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 more than these threshold quantities get some help, at Bankruptcy Experts Perth we guide individuals work through their choices when it relates to cars.
The Family Home
Just like with Bankruptcy and motor vehicles, the approach that can be taken to your residential property will be dependent upon equity. If there is no equity in your house, then there is no purpose 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 home worth $400,000 and you owe the financial institution $400,000 then more than likely you will have the chance to keep your home after bankruptcy.
The worst part about all of this though is that personal bankruptcy does not take into account emotions or excuses– you will not merely be able to keep your vehicle or home because you ‘need it’ or because you have a powerful emotional attachment. Bankruptcy can be cruel, but that is the reason why you should ensure you speak with the right people. Don’t jeopardize your family home by assuming or wishing you will have the capability to maintain it post-bankruptcy just because you need to live somewhere.
If you are anxious over your home or any other component of this Bankruptcy Means Test, then call us at Bankruptcy Experts Perth on 1300 795 575 if you would like to know more about Bankruptcy and Houses or anything to do with Bankruptcy. We are here to really help you. Visit our website for even more information, www.bankruptcyexpertsperth.com.au.
We provide a Free- No Commitment Consultation so get in touch with us today 1300 795 575.