When a person in Texas files for bankruptcy protection, a trustee is assigned by the court. In addition to assessing assets the debtor has on hand that can be sold to pay off creditors, the trustee is also responsible for determining whether valuable assets were recently transferred, whether the debtor might get an inheritance or legal settlement in the near future and the timing of cash advances.
Recent property transfers to family members might indicate to the trustee that the debtor is attempting to hide property so they can keep it after the bankruptcy. If the trustee discovers a debtor has done this, the property may still be seized and sold to pay off debts. In some cases, an attorney can protect the property if it isn’t transferred.
Trustees are also interested in money a debtor might receive as a result of a lawsuit or an inheritance. When a person files for bankruptcy protection, they must disclose whether they are involved in an ongoing lawsuit or if they plan to file one in the near future. Although the trustee doesn’t always have an interest in these suits, he or she must be made aware of them. Disclosure of inheritances or potential inheritances from family members or friends must also be done as part of a bankruptcy filing.
The most effective way for a debtor to be able to keep their home, vehicle and other personal property after filing for bankruptcy is to work with an attorney. A lawyer who focuses on bankruptcy law may use legal means to protect assets from seizure by the court so that the debtor can get a fresh financial start without losing all the things they need to survive.