Filers of a Chapter 7 or Chapter 13 bankruptcy will have to disclose and value their assets. While there are always exceptions, this post should help you value your assets correctly.
My pets are priceless to me, and I would never sell them. How can I put a value on them?
I hear this question frequently. In bankruptcy, we don’t take sentimental value into account. Nor do we ask if an asset was a gift or how much you paid for it. The question is, “how much would you get if you sold it?” That’s just the start. If you could find the right buyer, you might be able to get $2,000 for your pup, but that isn’t likely. There are a lot of standards out there, but the easiest one for most people is what a reasonable person would pay in the “proper market.” For most household goods, the proper market is a garage sale or pawn shop. For an authentic Tiffany lamp, the proper market might be an arthouse auction. (I’ve never had a client with an authentic Tiffany lamp.) The key here is “reasonable.”
Do I have to itemize my forks?
No. Every attorney has a different method. I have my clients complete a worksheet, with the most common assets pre-listed. All you have to do is value them. A lot of things can be grouped together. While it’s improper to simply list “All of my stuff: $8,000,” it’s unnecessary to itemize everything in your house. Again, the important thing is to (callback alert!) be reasonable. Attorneys may differ on how precisely they group assets, but there are many viable options.
Okay, I get it. But why do I have to disclose all of my assets in the first place?
Because the law requires it. You are allowed to keep a certain amount of “stuff” (fancy legalese there) in bankruptcy by using exemptions. Exemptions aren’t unlimited, but they’re generous enough that most people, at least in Wisconsin, don’t lose anything in bankruptcy. Exemptions can be tricky, so make sure to speak with your attorney before filing the case. If you don’t disclose an asset, you can’t exempt it, and you may lose it. The only way to retain an asset is to disclose it and exempt it.
If you file a Chapter 7 bankruptcy or Chapter 13 bankruptcy, your attorney will ask you to value your assets. This is to help keep them for you. If you are looking for debt relief in SW Wisconsin, give me a call.