Cakes feature often in popular metaphors and similies and they're also delicious.

Chattels sell like hot cakes and clueless monarchs suggest the hungry substitute 'em for bread. In Bankruptcy Land, the phrase of choice is to have one's cake and eat it too. It's a confusing proverbial corruption: it reads like a redundancy given that having something is synonymous with eating it. Syntax is everything. Back in the sixteenth century, which was a good century for English, it read more clearly, wolde you bothe eate your cake, and have your cake? That lovely phrase translates more clearly to convey that after you've eaten your cake, you can't expect it to remain yet uneaten on your plate. In Bankruptcy Land, this comes to play in the assessment of assets.

Chapter 7 bankruptcy is called liquidation. The debtor's property is liquidated for the purpose of repayment of debt. The Bankruptcy Code does not lack for words, yet apparently space ran out in this instance. A single apt modifier was cut: possible. Chapter 7 bankruptcy is possible liquidation.

California has a bunch of nifty statutes that exempt (exclude) a finite amount of property from liquidation in chapter 7 bankruptcy. Thus, you can eliminate debt without losing the shirt off your back. But within reason: you won't find them in MY wardrobe, but there are some awful expensive shirts out there.

Occasionally, I have to quote the cake proverb to a client. When you stroll through my door, you'll be handed a clipboard with a brief questionnaire clipped to it. In one column, said questionnaire will ask that you list your secured properties. In a corresponding column, you'll list the balance on the loans for those assets: this would be the payoff on a mortgage or the payoff on a car.

It's happened that the payoff line for a very, very expensive home or car was left blank. I assumed it was oversight, but sure enough, the asset was a paid-off property. That's bad news. Say, for example, you have a $600,000 house owned free and clear. In your case, bankruptcy would not benefit you if your debt is limited to $50K. The house would be sold, the debt would be paid and then some. The trustee liquidating the property would collect a surcharge after she paid your creditors from the sale proceeds. In practice, this revelation results in an awful brief consultation. But the not-to-be-client has learned something and it cost them nothing. It cost me something (time and expense), but from the circumstance, I did get to mutter, wolde you bothe (which is fun to say) AND I got a blog out of it. Also, it got me thinking about cakes and cakes are delicious.

Note: this is a vague illustration and it applies to California law only. Filing for bankruptcy without seeking legal counsel can be pretty, pretty bad.