Santa Ana, CA asked in Bankruptcy for California

Q: Can I put my 30% ownership interest in a condo into an LLC in case I go bankrupt in a couple years so it can’t be taken?

Does an LLC make my ownership interest exempt from being taken by creditors?

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4 Lawyer Answers

Ronald Holland

Answered
  • Bankruptcy Lawyer
  • Roseville, CA
  • Licensed in California

A: This is the same answer as before. If you are the owner of the LLC, whatever it owns, in net assets, is an asset of yours. Seek legal advice from an experienced bankruptcy attorney. Trying to file bankruptcy by learning a few things online is going to get you into trouble. Hire someone to represent you that knows bankruptcy law thoroughly.

Timothy Denison

Answered
  • Bankruptcy Lawyer
  • Louisville, KY

A: No. It is still an asset. Transfer it to your parents and wait out the insider transfer period before you file. You should consult an experienced bankruptcy attorney before doing anything.

Peter Maurice Lively

Answered
  • Bankruptcy Lawyer
  • Culver City, CA
  • Licensed in California

A: That will not protect the property from being reached by a chapter 7 trustee. If you transfer the property without receiving comparable value and return, you will create a recoverable fraudulent transfer for your bankruptcy estate for up to 10 years depending upon the types of creditors you have when you file your bankruptcy case. You may have alternatives that are considered to be legitimate prebankruptcy planning and not create recoverable transfers to your future bankruptcy estate, but you need to consult with an experienced bankruptcy attorney for a review of all your financial facts and circumstances to determine your options.

Harlene Miller

Answered
  • Bankruptcy Lawyer
  • Irvine, CA
  • Licensed in California

A: I agree with Mr. Lively's comments. Also, Transferring assets in contemplation of bankruptcy is a slippery slope. You really need to consult with an experienced bankruptcy attorney in order to understand all of the issues and how best to protect yourself and assets that you have.

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