Published on:

Can I Keep My Furniture And Personal Belongings If I File For Bankruptcy?

Yes, you most certainly can. Although it is necessary to disclose all personal property (whether it is furniture, appliances, clothing, pots, or pans), there is a very slim chance that the Trustee would actually want any of these belongings. This is because of the governmental exemptions that can be used to cover such assets.

When you file for a Missouri bankruptcy, the court requires that you make the bankruptcy Trustee aware of the extent of your property. Individuals can own all sort of things: personal goods, clothes, books, stamp collection, guns, etc.) And the full range of these possessions must be disclosed in your bankruptcy schedules (i.e. the documents filed with the court that represent your bankruptcy estate). The primary way in which you disclose this property is by assigning it a value. Specifically, garage sale value. In other words, the amount of money that you honestly believe these items would bring at a garage sale. And if you think about it, that is probably not too much. Because you aren’t using the price that you originally purchased the item at (how many times have you bought something at a garage sale that is set at the same price as what you see in the store?); and you aren’t using ‘sentimental value’ either (because if we priced goods at a garage sale based on what they mean to us personally, we probably would never be able to sell a thing). Once the garage sale value is assigned, the proper state exemptions are applied. These exemptions are really just devices for keeping your property safe, and out of the hands of the Trustee.

So for instance, the Missouri state exemption for Household Goods is set at $3,000.00. Assuming that your household goods have a garage sale value of $3,000 or less, then all such belongings are exempted (i.e. they will be safe). And unless you have furniture that is gold-plated, and was bought from Tiffany’s of New York, then chances are you fall into that category. But if you in fact do have household goods that have a garage sale value in excess of $3,000, then it is possible that the Trustee may wish to have the items appraised so that he/she can make a determination as to whether this property should be liquidated in a sale.

The same holds true for much bigger-ticket items, like cars, trucks, and real estate. For each of these, there are certain state exemptions to cover any equity that may exist. If the exemption does not fully cover the outstanding equity, then again, the Trustee may seek to have the asset liquidated. For example, you are given a $3,000 exemption to cover equity in a car. So if you own a 1997 Chevy that is paid-in-full, there is a good likelihood that the car will be more than covered by the $3,000 exemption (and therefore kept safe). But if the car in question is a paid-in-full 2010 Mercedes that carries a Blue Book value of $15,000, then obviously there is going to be a tremendous amount of equity even after the exemption is applied (15,000 – 3,000 = 12,000 left over in equity). In this example, there is a very good chance that the Trustee is going to want to liquidate the vehicle in a St. Louis Chapter 7 bankruptcy, or ask that you guarantee the equity to your unsecured creditors in a St. Louis Chapter 13 bankruptcy.

The affordable St. Louis bankruptcy lawyers at Brinkman & Alter, LLC have been making sure that our client’s needs are met for years. Our goal is to ensure that you keep all items that you want, get rid of all debts that you wish to be done with, and do it all at an affordable cost. Call today so that we can get you the fresh start / clean slate that you deserve.

Contact Information