Legal Question in Bankruptcy in Illinois

Bankruptcy

I might have to declare bankruptcy due to bad tenants in 3 rental properties in Illinois. I would like to get rid of the duplex and house, but keep my house. Is this possible? I also have a vehicle with no loan. I also have a portfolio of securities that were worth $35000 when I invested but only a few thousand now due to a bad market. I would hate to have to sell them to satisfy only a small portion of the mortgage debt i would owe on the rentals. I bought both rentals with no money down, so I imagine the banks will sell them leaving at least an $80000 difference which they will no doubt want me to pay. That is why I want to do bankruptcy. Deed-in-lieu is not an option as they are 80/20 loans with 4 banks involved in the 2 properties. I have an s-corporation and was thinking that I could transfer my Ameritrade account to an already existing corporate ameritrade account. I would like to transfer the vehicle too. If I do can they still be touched in a bankruptcy ruling? My s-corp is 3 years old and I am the sole shareholder. If I transfer these things now will it look like I'm trying to hide assets? It's not much, but I need to start over with something. I haven't worked in 3 months and won't be called back for 3 mor


Asked on 2/17/09, 10:02 pm

3 Answers from Attorneys
Lesley Hoenig Lesley A. Hoenig, Attorney at Law

Re: Bankruptcy

Yes, if you transfer assets to your s-corp now, it will look like you are trying to hide assets and will not result in your assets being protected. It would actually cause more problems than you think it would solve. I highly recommend consulting with a local bankruptcy attorney and being totally honest about what you own with them to ensure that you have a smooth bankruptcy.

Read more
Answered on 2/18/09, 1:11 am
Lesley Hoenig Lesley A. Hoenig, Attorney at Law

Re: Bankruptcy

Yes, if you transfer assets to your s-corp now, it will look like you are trying to hide assets and will not result in your assets being protected. It would actually cause more problems than you think it would solve. I highly recommend consulting with a local bankruptcy attorney and being totally honest about what you own with them to ensure that you have a smooth bankruptcy.

Read more
Answered on 2/18/09, 1:30 am
Robert D. Rotman Rotman & Elovitz, Ltd.

Re: Bankruptcy

You should not transfer any of your assets at this time. Some transfers may be considered fraudulent and may be subject to the trustee's avoiding powers. If you qualify for a chapter 7, you will be able to surrender the properties to the banks and owe nothing. You may be able to keep your home and car depending on your equity.

Read more
Answered on 2/18/09, 2:59 pm


Related Questions & Answers

More Bankruptcy Law questions and answers in Illinois