Bankruptcy A-Z: N is for “No Asset Case”
January 5th, 2012 | 
Author: Bankruptcy A-Z: N is for “No Asset Case”.
The goal of a bankruptcy for most people is to protect their assets. In Chapter 13 cases, individuals keep their assets and pay the unexempt value into the plan. In a Chapter 7 case, individuals need to make sure that there is no unexempt property. This type of case is a no-asset case, because there are no assets available to satisfy any portion of the creditors’ unsecured claims.
N is for “No Asset Case.”
In Chapter 7 cases, all debts must be classified into either secured, priority or unsecured nonpriority.
Secured creditors are entitled to their liens (unless they can be set aside). Either you pay the debt or lose the property.
Priority creditors, like taxing authorities for certain taxes, child and spousal support and other specific types of debts, are entitled to be paid and hold debts that are not subject to discharge in Chapter 7 cases.
General unsecured creditors are everybody else. This category of creditor only gets paid if the debts they hold are not subject to discharge OR if there are unexempt assets.
If all assets are exempt under state or federal law, the trustee will have no assets to administer. He (or she) will issue a report of no distribution and the case will close with a discharge with no assets lost.
If you have assets that you need to protect, talk to a lawyer before doing anything that can jeopardize your case.
If you are in metro Richmond, Hanover or Caroline Counties or anywhere in central Virginia, contact Consumer and Bankruptcy Attorney Mitchell Goldstein at mitch at mitchellpgoldstein.com or (804) 592-1674.
Other N posts:
N is for Nondischargeable Debt or Nondischargeable.
N is for Naked.
N is for Notice
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Photo Credit: Steve Snodgrass
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