Parent’s property at my house
When my parents downsized from their family home to a condo, they allowed me to take many large furniture items for use in my home. Technically, they did not give them to me and I am just using them although eventually some will be mine and some will be dispersed amongst my siblings who currently do not have established homes. What happens if I declare bankruptcy? My parents would be very upset if their family furniture (dining room set, oak hutch, etc.) where mysteriously missing when next they came to visit. Will this property be sold if it is over the exempted amount? Like I said technically I am not the owner, but that would be difficult to prove/judge. Also, some if it will likely one day be my property. I don’t want to do anything fraudulant here…how would this be viewed by creditors/trustee?
Each province lists a set of exemptions that you are able to claim exempt and will be protected from your creditors if you file for bankruptcy. One important thing to consider is when calculating the value of the assets in question is that it is done on a liquidation or garage sale basis.
In the event that the assets are valued greater than the permitted amount you will either have to sell the assets in question or repurchase the assets from the bankruptcy estate (for more details on whether this is permissible in your province you should contact a local trustee).
Where those assets technically belong to your parents they would not be included as your property if you can clearly prove that they belong to your parents, or potentially if your parents would be willing to provide an affidavit in connection with the furnishings attesting that the property is in fact theirs.
This is a good issue to discuss with a trustee in your area as there are substantial difference in the way these circumstances are treated between provinces.