South Florida Bankruptcy Lawyer

Debtor in Possession

In most cases, declaring bankruptcy means losing possession of those assets on which a creditor has a line of credit. These assets can include a house, a car, a boat, home appliances, etc. Usually, declaring bankruptcy means losing possession of those assets if the creditor still has an unpaid investment in that object. There are some cases, though, in which the debtor can remain in possession of certain assets, even after declaring bankruptcy.

Under certain circumstances, the debtor can arrange to pay a fair market price of the asset to the creditor rather than the contract price. This is most associated with assets that depreciate in value, like automobiles. In addition, if the debtor needs to maintain possession of the vehicle in order to keep or search for employment, he can sometimes arrange to keep the vehicle. After declaring bankruptcy, continued employment is often the only way to successfully pay back debts, so the debtor can keep the vehicle, in certain instances, to make repayment possible.

Also, an owner of a business that files for Chapter 11 bankruptcy but continues to run the company is considered to be a debtor in possession.

Speak with a Boca Raton Bankruptcy Attorney

It can be very confusing to discern exactly what rights you have when considering bankruptcy. Contact the experienced Boca Raton bankruptcy attorneys of Eric N. Klein & Associates, P.A. at 561-353-2800 for guidance.