I often meet with clients who need help through bankruptcy, but have inherited a piece of real estate or other kind of property from a relative which the client now owns free and clear. They are concerned that they will lose this property if they file for bankruptcy.
In these situations, North Carolina bankruptcy exemptions protect a certain amount of property you own. Once the property has been deeded to you, inherited by you, or transferred to you, the bankruptcy court considers it to be your property. Transferring the property to someone else before filing does not help, and could be considered fraudulent.
However, if the exemptions protect your property, the Trustee cannot seize the assets. Filing a Chapter 7 bankruptcy might be a good option. On the other hand, if the free and clear property is exposed in a Chapter 7, a Chapter 13 bankruptcy should be explored.
If you qualify, you can protect non-exempt assets in Chapter 13, and still get bankruptcy relief. A Chapter 13 filing sets up a payment plan where debts are discharged after a certain percentage of debts are paid back over time. For many, Chapter 13 provides a way to make ends meet every month without having to sell a piece of property which means a great deal to their family.
If you have any questions about the bankruptcy process, I would be happy to help with a free initial consultation.