Asset Exemptions

[john5527]

I am in the process of filing for chapter 7. I am listing all of my assets as told. Will I probably lose things like a treadmill, tv, computer. I know you are allowed certain exemptions, but I wasn't sure. Anybody have experience with this and what you are allowed to keep? Thanks so much

Oh, I live in IL

[SMinGA]

Just looked up the IL exemptions, it appears you are allowed $2,000 value in personal property. Your attorney should be able to cover the specifics with you.

[gmk]

I.m no pro at this but I've read the IL exemptions doubled in IL in 2006 so the "wildcard" is $4,000. Many sites still list it as $2,000. Also, if filing jointly the wildcard is doubled to $8,000.

My attorney says it very bluntly, "they don't want your stuff." Too much trouble to sell a treadmill or other such things.

[justbroke]

My attorney says it very bluntly, "they don't want your stuff." Too much trouble to sell a treadmill or other such things.

I wish your Trustee would smack some sense into the notorious Middle and Southern District of Florida Trustees who a.) want to send an appraiser to everyone's house and b.) if they find value, everything goes to auction... no negotiating!

Yes, there are reasonable Trustees out there.

(Yes, Illinois has a $4,000 wild card per debtor.)

[seFlaDude]

[QUOTE=justbroke;401348]I wish your Trustee would smack some sense into the notorious Middle and Southern District of Florida Trustees who a.) want to send an appraiser to everyone's house and b.) if they find value, everything goes to auction... no negotiating!

justbroke,
I had heard the middle district trustee was very strict like that but had not heard the southern district trustee was that way as well, I am in the southern district and now concerned, is this from you own experience ? any more info reference the southern district chapter 7 trustee?
Thank You

[Mensa1]

I wish your Trustee would smack some sense into the notorious Middle and Southern District of Florida Trustees who a.) want to send an appraiser to everyone's house and b.) if they find value, everything goes to auction... no negotiating!

It would be very interesting to track a 6 or 12 month period of time of ALL Ch 7 cases that were converted to Asset cases. Determining what the COST is to administer this charade versus the return of such auctions. I suppose that it is profitable or else the TT wouldn't conduct the auctions but I really doubt that the offset would be worth the time and hassle to do all this. Maybe most filers settle in order to keep the items, and therein lies the problem. If in every case the TT had to pay for conducting the auction maybe there would be far less items liquidated.

How does TT actually conduct the auctions? eBay, CL, or ??? Seems like someone needs to challenge the conceptual and the implementation; as this seems a lot like hostage taking.

[gmk]

I hope the auctions aren't on-site auctions. Yowch

I guess a lot of why trustees would go the appraisal/auction route has to do with the state's exemptions. I don't know about Florida but $8,000 (joint) of wildcard in IL would take a lot of auctioning to make it worthwhile for most households.

When I questioned my attorney on the small numbers used for my physical assets he said, "Look, all you have is junk. No disrespect, I have the same junk, just in a different location." He also said that in his twenty years as a Ch7 trustee, he's only sent someone out to valuate a few times when he thought they were outright lying.

[justbroke]

The problem is that a good number of Chapter 7 cases, keep their homes. This gives them $2,000 (joint) or $1,000 (single) in exemptions. This is why it's obvious to the Trustee that your home is not filled with only $1K / $2K in junk.


I have no direct experience with Trustees sending someone to my home for a valuation.

[Mensa1]

The problem is that a good number of Chapter 7 cases, keep their homes. This gives them $2,000 (joint) or $1,000 (single) in exemptions. This is why it's obvious to the Trustee that your home is not filled with only $1K / $2K in junk.


I have no direct experience with Trustees sending someone to my home for a valuation.

What method of auction/resale does the TT use? I can't imagine that they move things off site. The transportation - material handling costs would be a killer.

[justbroke]

What method of auction/resale does the TT use? I can't imagine that they move things off site. The transportation - material handling costs would be a killer.

No idea. I have no direct experience with this. You're right, moving it around would be a pain. Maybe they do it with pictures? No clue.

[gmk]

For the valuation part of it, my attorney indicated that they send someone in with a video camera. I don't know who or even what that person's qualifications are? I'd still be interested to know if they pick and choose your "stuff" and if they auction at the residence?

My father had a steep downturn in his career at one point and he decided to pack it up in New York and start over in Texas in the mid-60s. So he had the family treasure auctioned at our house. (If he went BK I didn't know). Like the teenage jerk that I was, I felt humiliated and had no kind feelings for my parents. Older, possibly wiser but definitely and belatedly more sympathetic to my parents. The old man's pride took a beating that day.

I think Mensa1's comment about all the trouble it is to get value out of stuff is on target. They just don't want to fool with your stuff. Too much work and too little gain. Unless of course you happen to live in Florida where I take it (no pun intended) it seems to be a more common practice.

[pandacb]

We are in Oregon. Our attorney said something to the effect that the trustee doesn't want any of our stuff unless he can get at least $500 out of selling a certain thing. The attorney also said that I had likely overvalued our items because I used the Salvation Army, Goodwill, etc.

A specific example for valuation is our couch...it is a flexsteel, leather couch that cost $2300 eight years ago. To me, it is valuable even though it "raised" three kids, a couple of dogs, etc and it sags a little and the frame has been repaired. I priced it at $200 - the attorney laughed (politely)

I was very worried about the television my husband bought for the family three years ago because it cost 1900.00 and I thought tvs kept their value...not so, I was told....they build better ones every day and three years is a whole lifetime for a tv.

Please tell me this is good advice!

[john5527]

We are in Oregon. Our attorney said something to the effect that the trustee doesn't want any of our stuff unless he can get at least $500 out of selling a certain thing. The attorney also said that I had likely overvalued our items because I used the Salvation Army, Goodwill, etc.

A specific example for valuation is our couch...it is a flexsteel, leather couch that cost $2300 eight years ago. To me, it is valuable even though it "raised" three kids, a couple of dogs, etc and it sags a little and the frame has been repaired. I priced it at $200 - the attorney laughed (politely)

I was very worried about the television my husband bought for the family three years ago because it cost 1900.00 and I thought tvs kept their value...not so, I was told....they build better ones every day and three years is a whole lifetime for a tv.

Please tell me this is good advice!

Thanks for sharing this information. This makes me feel better. I am stressed out enough right now.

[pandacb]

In valuing our things, one really helpful thing was going to local garage sales. I went to the same sale twice, several times...at the beginning to see what prices were and also at the end to see what was left. I learned alot about used values - paperback books were often priced at only 50 cents and were still sitting there at the end of the sales. Ditto for clothing.

Furniture sold almost always but the couches were selling for only 75 or 100. Bedroom furniture was hard to find but one thing I learned is that nobody really wants to buy a used mattress...so no matter how much I paid the key is what somebody will pay.

I hope this helps. I know it is scary. I just finished the attorney's requested paperwork and have been awake night after night second guessing. My guidepost is that I know we are not trying to cheat or hide anything but only trying to do a fair job of things. Reminding myself of that helps alot because we are all just human afterall. The flip side of that is that thinking is that the road to hell is paved with good intentions - now I'll be awake again!!! You are not alone in your worries and what is that old saying... a burden shared is a burden lightened. Good luck.