Valuation and Disclosure of Assets

This refers to your legal responsibility to list and value on your bankruptcy papers everything you own, tangible or not, and wherever located. This is true whether you have a current ownership interest or some right to own something in the future – such as a stock option, right of first refusal, a claim for worker’s compensation or personal injury, and/or an interest in a life estate. You are required to list everything you own regardless of value or significance and regardless of HOW MUCH of the asset you own – i.e. property owned jointly. If any asset has proof of ownership – like a title, deed, or statement – you must also produce those.

Household goods and common personal property. With regard to household goods and such, you may group assets together for description and valuation purposes. For example, you can list an asset as “lawnmower and yard tools” and “living room furniture” rather than listing each item separately. With regard to valuation, this is your responsibility. You should use what’s commonly called the “yard-sale value” for common, everyday belongings such as household goods and clothing. Items of uncommon character or value. If you have something that, standing alone would be worth $1000 or more. You should list that item separately and provide a basis for the value. This could be anything from a piece of art, to jewelry, to pricy electronics, to heavy duty power tools, to a collection of some sort – like antiques or firearms. Each of these types of items must be listed separately without being grouped. For valuation purposes, you can use various resources such as a written offer from a pawn shop, a written appraisal of value, or sometimes, a listing you find online of a recently sold item similar or identical to yours. If you are having trouble valuing these items, talk with us.

Financial accounts. Accounts of EVERY KIND are valued by producing the statement issued by the financial institution. This includes but is not limited to regular bank accounts, retirement accounts, pensions, stock accounts, money market accounts, annuities, and cash value life insurance policies. Motor vehicles and boats of every kind. These are usually valued per the Kelly Blue Book or NADA websites. Generally, you should produce the Trade-in value for cars, trucks and vans. Other values can be used for boats, trailers, etc. Speak with us if you have questions. There are times when you will be required to obtain a written appraisal; but do not take those steps unless you are instructed to do so.

Real Estate. Your home and every other piece of real estate that you own will be valued in a number of ways depending on the circumstances of your case. For case preparation purposes, initially, you should produce both the tax assessed value and the valuation from www.zillow.com. YOU MIGHT be required to acquire a broker’s market analysis or even an appraisal; but, do not take those steps unless you are instructed to do so.

Exemptions and Exempt Assets refers to state and federal statutes that permit you to protect certain types of assets from a chapter 7 liquidation and from a chapter 13 liquidation analysis. If you are a Maryland resident for at least the last two years, you will use the state law exemption statutes. If not then we will tell you which statutes you will use. We will prepare an exemption analysis of all of your assets BEFORE filing your case. 93% of all chapter 7 cases filed nationwide are called “no asset” cases because there are no assets that are not exempt. If you have assets that are not exempt, the exemption analysis we do for you will discover that issue so that we can properly address 6 it before we file your bankruptcy case. Simply put, when an asset is exempt in a Chapter 7 case, it means you get to keep it. When an asset is exempt in a Chapter 13 case, it means that the value of that asset is not factored into the Chapter 13 plan.

Disclosing all of your debts means that you are required to list every debt that you know about. This includes debts to friend and family, as well as your pastor, babysitter, favorite doctor, the power company, the phone company, and any other person or company that has a debt you owe. It is often impossible for a person to remember all of the debts that they owe over their entire life. Generally, even if you forget to list a debt, your bankruptcy case can proceed, and even that forgotten debt is subject to discharge. However, there are exceptions to that rule, so if you remember a debt AFTER your
bankruptcy case is filed, please let us know, and we’ll advise you.

Household Income means income from every source and for every person in your household unit.

Household Expenses means all reasonable and necessary expenses required of all persons in the household. These do not include payments made to general unsecured creditors, which should have ceased already.

Motion to Incur New Debt refers to the motion we must file whenever you wish to obtain a new loan. DURING YOUR CASE, if you need a replacement car, a home 7 refinance, or any other type of credit transaction, you are required to seek court permission first. Once your case is over, so is that requirement.