The business owner has a serious problem because all their assets can be subject to seizure by creditors, even their community property if they are married in this marital regime. Only the so-called unseizable assets such as clothing or furniture necessary for the home, or business income equivalent to the minimum wage (if the income exceeds this amount, it is seizable according to certain percentages established by law) are exempt from seizure.

The most serious problem is that the business owner’s own home may be repossessed, endangering family stability and introducing a huge stress factor into the freelancer’s own activity. What not many sole traders are aware of is that they can safeguard their main residence through a simple procedure, which will give them great peace of mind if their financial situation worsens at any given time.

The business owner must register in the Mercantile Registry of their place of residence, stating their status as a limited liability business owner and specifying which property is to be kept out of the reach of creditors.