Schedule Your Estate Planning Consultation OR "Don't Go Broke" Strategy Session 404-419-7155

315 W. Ponce de Leon, #600
Decatur, GA 30030, USA


Make Sure You Are An Unappealing Lawsuit Target

asset protection

Asset protection is something that must be in place prior to being served with a lawsuit.

If you have exposed wealth, you are an easy lawsuit target. Any lawyer, and practically any person with the least bit of research savvy, can do an instant electronic asset search and financially profile you. Within seconds, an online asset search will reveal whatever real estate, business, auto, boat, artwork, and other tangible assets you now own or have ever owned. Asset searches also disclose mortgages or liens against your property.

In order to be unappealing, you want it to appear that everything you own is mortgaged to the hilt. In our debt-ridden society, it is not unusual for people to owe as much or more than they own.

Poverty As An Asset Protection Strategy

Nothing discourages prospective litigants faster than finding out that a would-be defendant is mortgaged to the eyeballs. You can own millions in assets, but when they are fully mortgaged, you are a poor lawsuit candidate. Litigants want assets with equity. When your assets can be claimed first by other creditors, you are paper poor.

Appearing poor on paper is one way to repel anyone from initiating a lawsuit against you. There are a variety of ways to create the appearance of poverty. One way is to encumber everything you own. This is something that can be done even after a lawsuit has been initiated, unlike setting up trusts and other types of asset protection strategies. It is wise however to have an asset protection plan in place even if you never become a defendant in a lawsuit.

Encumbrance Can Be Useful

Any asset can be security for a loan. Depending on your circumstances it is usually worth the small amount you’ll pay in loan fees versus what you would pay in legal fees and settlement fees should you become the target of a lawsuit. And that is whether you win or lose. Lawsuits are expensive no matter what end you are on.

Refinancing real estate to strip equity may not seem to make financial sense, though it does make legal sense when someone is suing you. If you own any real estate get an equity loan to cover as much of your property equity as possible

A variety of ways and means can be employed to protect your assets. The important thing is to be proactive. You may never be sued, but if you are and you are not protected, you stand to lose everything. Ensuring that your assets are out of reach of prospective litigants is the best strategy. That requires pre-planning.

Seek Professional Guidance

You’ll need the right professional guidance to create a solid asset protection plan. Once in place, you can rest assured you will not be appealing to anyone desiring to file a frivolous lawsuit against you. And should you be involved in an event in which someone is seriously injured on your account, chances are you are going to do the right thing, which means you have the proper insurance to handle any claims that are rightfully brought against you.