When you file for bankruptcy you are required to disclose everything you own! This includes your physical assets such as cars, real estate, art and jewelry as well as intangible assets such as a personal injury claim or insurance claim for fire damage.
Any claims you have against others whether its individuals or corporations become part what is known as property of the bankruptcy estate.
The Trustee overseeing your case has the right to enforce your rights in such lawsuits or by going after insurance proceeds and using the unexempt portion to pay back your creditors. You, as the debtor, have no rights unless the Trustee abandons the asset.
Trustee will inform you or your lawyer that he or she no longer wishes to pursue the asset or by simply filing a No-Asset Report. Until that moment, you can’t do anything with your claim without the Trustee’s blessing.
Don’t forget, however, that if you still have room in your exemptions you can protect part or all of the claim. It’s always advisable to consult with a knowledgeable bankruptcy attorney for assistance with your case.
If you have a question about bankruptcy please call me at 410-849-9529.
Posted by Joseph Githuku
Disclaimer: This article is provided for informational purposes only and should not be construed in any way as legal advice. This article does not create an attorney-client relationship.