Bankruptcy Knoxville

By declaring bankruptcy a person often affects more than just himself or herself. Sometimes it can affect other family members who have financial dealings with the person filing. So how should you handle this situation? If you’re a private person, you may not want to disclose the bankruptcy if you can avoid it. The best thing to do is first figure out whether it’s even an issue.

The best way to do this (and yes, I know it sounds self-serving) is to speak to an experienced Knoxville bankruptcy attorney. Go in for the free consultation, explain your situation and any difficult issues such as family financial dealings, and get the advice you need. You may be able to avoid disclosing the bankruptcy or you may be able to avoid the bankruptcy altogether. But the bottom line is, you need sound professional advice and we’re here to provide it.

The Dallas News provides an interesting example of when bankruptcy can affect family members:

Question: Our daughter lives in California. She is POD on several of our CDs. Her financial condition is dire and she may have to declare bankruptcy. Would this affect our CDs? Could her bankruptcy have access to our CDS? –Carolyn

Answer: Carolyn, your question is unfortunately being asked more and more often. Pay on Death (POD) accounts do not convey ownership to your daughter until your death. Consequently, these assets should not be part of your daughter’s bankruptcy estate at this time. Once you have passed away, however, these assets would most likely be within the reach of her then creditors. I suggest you consult with your estate planning attorney and consider passing these assets to your daughter in trust. A properly drafted trust should allow you to accomplish your goals.