Giving Items Away or Transferring Assets
Clients often ask if they can quit claim (many of you will call it quick claim which is a common mistake) the title of their house. Can they give away their car or other assets to a relative to protect it during the bankruptcy. The answer is no. Under the Bankruptcy Code, giving away assets before or during the bankruptcy may be considered a fraudulent transfer. This means the bankruptcy trustee can object to your discharge and prevent you from ever getting a discharge on those debts listed in your bankruptcy. In short, you have to pay back all of your debt and you get no bankruptcy relief. On top of that, the trustee may file a lawsuit requiring you to pay the trustee for the value of the item. Schedule a free consult with one of our Murrieta bankruptcy attorneys in order to determine the best plan of action before you file for bankruptcy and before you give items away.