Are you confused on which assets does a bankrupt have to surrender to the Trustee? These bankruptcy assets are otherwise referred to as divisible assets. These assets are not protected from the Trustee and their right to recover them for the benefits of creditors. The most common assets to fall wiith in this category include:

• Real property – These properties includes apartments, house, vacant land, farms and business premises. Often these properties will be subjected to a mortgage. At first a Trustee will need to find out if there is any equity in the property making it suitable to realize. In case where there is sufficient equity in the property the Trustee will approach the mortgagor to sell the property. In the case where there is insufficient equity in a property then the Trustee will disclaim the asset. There is no distinction made on whether the property is located within Australia or overseas the Trustee still has the power to take possession of the property.
• Motor vehicles above a specified limit – if you own a motor vehicle with equity above the prescribe limit set by the Insolvency Trustee Services Australia your Trustee will be able to repossess and sell the vehicle and realise the equity amount above the prescribed limit.
• Shares and investments – All shares and investments owned or held by a bankrupt will become vested in the Trustee. For the benefit of the creditors the Trustee has the power to sell off these assets. It does not matter whether the property is located within Australia or an overseas country; the Trustee has the power to take into possession the shares and investments.
• Proceeds from deceased estates – Should you be named an beneficiary of an estate and if that person becomes deceased before or during your bankruptcy, your Trustee has the right to collect the proceeds from the deceased estate.
• Winnings from competition or lottery – Any lottery or other type of windfall from a competition that you receive before or during your bankruptcy, your Trustee may recover the winnings and pay out to your creditors.
• Tax refund from income earned before you become a bankrupt – if at the time you become a bankrupt you were due n income tax refund for any income that you earned before you were a bankrupt, your Trustee may collect the tax refund and pay this to your creditors. Any tax refund for income that you earned following your bankruptcy is not recoverable by your Trustee.

For more information on bankruptcy assets, visit www.armstrongwily.com.au/articles