Why Hiding Assets in Bankruptcy is Bad Faced with the predicament of bankruptcy litigation, its common to see people opting for various avenues to safeguard as much as assets possible. Hiding assets is primarily one of them. Whenever you file for bankruptcy in New York City under Long island bankruptcy law, it is mandatory to inform the court about all assets currently being owned. In some cases of bankruptcy certain assets are sold to adjust against claims of creditors. While certain types of assets are exempt from being seized, most existing assets not necessary for survival are taken over by creditors. In such a scenario it has been observed that individuals filing for bankruptcy tend to suppress details about assets they actually own This presents the opportunity to wipe off all debts while safeguarding high value assets from being seized from creditors. If you consult New York bankruptcy lawyers, you will always be advised that this is not actually a smart idea.
It is only in very rare and exceptional cases that some courts allow persons with zero or very low assets to file for bankruptcy and clean off their debts. In such cases the creditors get nothing out of it. This is the only legal way to get rid of debt without paying a penny of it back. From transferring ownership of property to family members, to shifting ownership of inherited property to distant relatives, there are many ways tried out by people in financial distress. It's never advisable to go for the easy way out by hiding assets and trying to artificially create such a scenario.