With the recession in full swing, it’s not a surprise that many are filing bankruptcy as a way to get out of debt. Because of the large number of those filing bankruptcy and the introduction of the Internet age, everyone has become an expert. Many people feel when they file for bankruptcy it’s not necessary to disclose all their assets. Most people believe when they come to that place of filing, they believe they don’t own anything of value or else they would pay their bills off. Maybe their property isn’t worth much but it doesn’t change the fact that the bankruptcy code states that a debtor has to disclose all their assets.
When people file bankruptcy on their own, this is an area where the filers fail on their petition. People realize that they are required to list everything. How a bankruptcy attorney will usually explain it to the debtor is to list their personal property in groups. This is acceptable by the court and makes it easier for the debtor to list their items. You can put down clothing and value it at say for example $400. The debtor will need to go through their entire house doing exactly this. There have been many do-it-yourself bankruptcy filers that have walked into the 341 meeting and told trustee they really didn’t own anything when asked why they left it blank. If you live in America, even if you are sleeping on someone’s couch, you own something. This is another reason why it’s important to have the help of a bankruptcy attorney to avoid trouble they could stop your bankruptcy filing.
There is that other group of people that don’t disclose their assets because they’re hiding something. Many of these debtors think that the bankruptcy trustee is going to show up at their house with a big truck and haul off everything they own to a swap meet and sell it for the creditors. This is far from the truth. First of all, those filing for bankruptcy are protected by state and federal exemptions that allow certain amounts of property to be protected. This again is one area where a bankruptcy attorney really earns their money.