I filed bankruptcy, why do I need to list a car I sold two years ago? 15 Answers as of March 15, 2011

In the bankruptcy packet it says to list all items sold before the bankruptcy. I sold a lot of stuff to get by such as a car and guns. Will the courts go after the items I have sold pre-bankruptcy?

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Law Offices of Michael J. Berger
Law Offices of Michael J. Berger | Michael J. Berger
Bankruptcy Schedules require you to list certain transfers and sales to prevent debtors from hiding assets, and to recover assets that are fraudulently transferred or sold for less than fair market value. For example, if you sell a free and clear Ferrari to your mother for $1.00 six months before you file bankruptcy, the Trustee will most likely sue your mother and move to set aside the transfer. If the sale was for full market value to a stranger, there is nothing to worry about. If the sale was for less than full market value and was to a friend or family member, that may be a reason to delay or avoid the filing of a bankruptcy petition. For expert legal advice that takes into account all the facts of your transactions, please call me.
Answer Applies to: California
Replied: 3/15/2011
Janet A. Lawson Bankruptcy Attorney
Janet A. Lawson Bankruptcy Attorney | Janet Lawson
That is why that question is there. List the things you sold, they are looking for things you sold way below fair market value.
Answer Applies to: California
Replied: 3/15/2011
Uriarte & Wood, Attorneys at Law
Uriarte & Wood, Attorneys at Law | Robert G. Uriarte
Only if the items were sold at prices way below the fair market value.
Answer Applies to: California
Replied: 3/14/2011
Indianapolis Bankruptcy Law Office of Eric C. Lewis
Indianapolis Bankruptcy Law Office of Eric C. Lewis | Eric Lewis
The Statement of Financial Affairs requires the debtor to list any transfers of property in the last two years to allow the bankruptcy Trustee to examine the nature of the transfer. If the transfer is deemed fraudulent, or made in contemplation of bankruptcy and for less than fair market value, the Trustee can "reachback" and reverse the transaction for the benefit of the bankruptcy estate creditors.
Answer Applies to: Indiana
Replied: 3/14/2011
William C. Gosnell, Attorney at Law
William C. Gosnell, Attorney at Law | William C. Gosnell
No, they will not go after the items you have sold pre-bankruptcy.
Answer Applies to: Tennessee
Replied: 3/14/2011
    Ursula G. Barrios Law
    Ursula G. Barrios Law | Guillermo Machado
    Because the bankruptcy rules dictate that you must list said sales. If you sold for less than fair market value, could be an issue (fraudulent transfer).
    Answer Applies to: California
    Replied: 3/11/2011
    Carballo Law Offices
    Carballo Law Offices | Tony E. Carballo
    The Court wants to know if you sold the property for its fair market value and what you did with the money. If you gave it away free or too cheap then the trustee can take it from the person to whom you transferred it or sold it. You cannot give away or sell below value property to avoid having it taken by the trustee in the bankruptcy case. If you sold it for the fair market value and can explain what you did with the money (such as used it to eat, pay rent, etc.) then there is no problem. Just be truthful and nothing will happen.
    Answer Applies to: California
    Replied: 3/11/2011
    Ferguson & Ferguson
    Ferguson & Ferguson | Randy W. Ferguson
    They are looking to see if you disposed of things knowing you were going to go bankrupt. It is normal. Your attorney can explain it if you don't understand.
    Answer Applies to: Alabama
    Replied: 3/11/2011
    Benson Law Firm
    Benson Law Firm | David Benson
    Occasionally, a very valuable item is "sold" to a friend or relative and, perhaps, title transfers but the physical asset is never relinquished to the "buyer." A debtor may also "sell" something to a person who is paid only to hold the property until discharge and then physically return it to the debtor later. These sham transactions may be entered into in order to avoid the reach of creditors or the bankruptcy trustee. Such deals may be a basis for a trustee's demand for compensation or even a motion to deny debtor's discharge.
    Answer Applies to: Ohio
    Replied: 3/11/2011
    The Law Office of Mark J. Markus
    The Law Office of Mark J. Markus | Mark Markus
    It's not likely that the Trustee will go after the asset itself, but if you transferred or sold the asset for less than fair market (or, "reasonably equivalent") value, the Trustee can sue whoever you sold or transferred the asset to and recover the amount of the difference between the actual value and the amount you received. If you sold it for fair market value, you have nothing to worry about.
    Answer Applies to: California
    Replied: 3/11/2011
    Law Office of Harry L Styron
    Law Office of Harry L Styron | Harry L Styron
    There are separate rules depending on who you sold things to and when. You should consult with bankruptcy counsel to provide full details and get specific answers.
    Answer Applies to: California
    Replied: 3/11/2011
    The Orantes Law Firm
    The Orantes Law Firm | Giovanni Orantes
    It depends. If you got a reasonable purchase price for the item, the Chapter 7 trustee may not even be able to recover them, though they will bluff. The larger the item, the more likely the Chapter 7 Trustee is to try to recover it. However, although I cannot assure you of it, Chapter 7 trustees usually do not bother unless the value is over $1,000. You should consult counsel and provide more details regarding the transfers for a complete answer.
    Answer Applies to: California
    Replied: 3/11/2011
    Judith A. Runyon, Esq. Attorney at Law
    Judith A. Runyon, Esq. Attorney at Law | Judith A. Runyon
    See question #10 in Statement of Financial Affairs of your bankruptcy petition.
    Answer Applies to: California
    Replied: 3/11/2011
    Burnham & Associates
    Burnham & Associates | Stephanie K. Burnham
    The Trustee is the person who is looking to see what happened to your assets. The concern is for people who may have "sold" something on paper to a friend or a relative for less than fair market value. If the questionnaire is from your attorney, the attorney may be looking to make sure everything is disclosed, rather than what the Trustee really needs. Usually, the Trustee stops right around one year from the date of filing Bankruptcy but for large items like cars or real estate, they may request further back.
    Answer Applies to: New Hampshire
    Replied: 3/11/2011
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