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Bankrupts

The decision to file for bankruptcy is a major decision which will have long term consequences and will impact your financial mobility for a long time. The appraisal will give you a sense of the value for some of your assets, knowing the market value for your items and their demand in the marketplace may change your decision to file. You will need to know the value of your items while filing, your attorney will want to know the compiled value of your assets and the judge will most certainly want to know the value of your items. If you knew you could sell an item and generate some much needed cash, would it change your decision to file?

As a rule, in a bankruptcy proceeding, the goal of one creditor is, essentially, to establish priority over the claims of other creditors. When you are completing the bankruptcy forms, fine art falls into the category of personal property, and you must provide the value of each item that you list, an appraisal would likely mitigate an objection by the trustee. When you list all of your property on Schedule A/B, you'll be asked to provide the "current value" of your personal property, which includes everything other than real estate. Another term for current value is the "fair market value." Fair market value is the price that a willing seller and buyer would agree that the item is worth assuming that there is no particular pressure to conclude the sale. Another possible explanation could be stated as the current or fair market value will be what a reasonable person would be willing to pay for your items.

What happens to your property in bankruptcy depends on whether you file under Chapter 7 or Chapter 13. In Chapter 13, you get to keep all of your property. In Chapter 7, you may lose property that isn't protected by an exemption. Consult with your attorney, completing forms accurately when filing for bankruptcy requires the assistance of a specialist with a thorough understanding of the legal paperwork and proceedings. It is a requirement when filling out the Schedule A/B bankruptcy forms that some articles of personal property be appraised or valued. Most bankruptcy attorneys will highly suggests obtaining an appraisal when it comes to fine art, the value of art is not diminished by age and it’s isn’t subjected to wear and tear like other functional objects within the home.  

The current value of the asset is established as of the day that the bankruptcy petition is filled. 

Jewelry, furs, and fine art, all fall into the category of collectibles, these types of items could need an appraisal, at Keon Parsons & Associates, we specialize in the valuation of post war and contemporary art and can provide you with the current sales value for your art. If it has been mandated that you get an appraisal or if you are calculating assets while determining whether to file or not, feel free to give us a call, we will be glad to help.

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