Garage/Yard Sales OnExempt Items

[nioka]

Is it OK to have a garage/yard sale selling exempt items prior to or during the bankruptcy period?

I will be surrendering my house and will not be able to move a large portion of my exempt household items. I thought I would start have garage/yard sales to get rid of them. The biggest thing I would be selling is an old lawn tractor I hoped to get about $600 for.

Or is it better to wait until after discharge?

[keepmine]

No problem with a yard sale. People sell stuff all the time prior to filing to pay the bills.

[AngelinaCat]

As long as the lawn tractor is not claimed on your schedules, it should be okay.

Even if it is, send a message to the trustee, to the effect of: "we sold a lawn tractor for $XX at a yard sale."

We let a bank 'safe deposit box' go during the course of our BK, because the fee jumped 50% over what we had been paying. We sent a letter to our trustee explaining why we were letting it go, and told him that the only things it contained were Family Papers.

He was satisfied with that.

[nioka]

AngelinaCat & keepmine,

Thanks for your posts.

My experience with yard sales is that they only generate a few hundred dollars and I thought I would just keep the cash around of for everyday expenses.

I am still in the process of selecting an attorney. Therefore there is no schedule.

Some neighbors stopped over last night. I told them I would be leaving the area once my BK was over and not taking any furniture with me. One offered to by my bedroom set and additional items. They told me they we give me $100 down and would pay me the balance over the next few months. I plan to file before the end of the month. I assume I will have to list all my furniture on my schedule. The entire total sale would amount to
$1000. Would it be OK to go ahead with the sale? Thanks.

[LadyInTheRed]

Some neighbors stopped over last night. I told them I would be leaving the area once my BK was over and not taking any furniture with me. One offered to by my bedroom set and additional items. They told me they we give me $100 down and would pay me the balance over the next few months. I plan to file before the end of the month. I assume I will have to list all my furniture on my schedule. The entire total sale would amount to
$1000. Would it be OK to go ahead with the sale? Thanks.

If your neighbors owe you money at the time you file, the receivable is an asset that should be listed on your petition and, hopefully, exempted. Put the agreement in writing and make sure your attorney knows about it.

Having a garage sale before filing BK should not be an issue unless it results in you having non-exempt cash on your filing date. Be sure that if you sell to a family member, they pay the fair market value. If you want to have a garage sale after you file BK, check with your attorney. He may advise you to wait until the deadline to object to your exemptions has passed which is 30 days after the completion of your 341 if no extension is granted. Chance are that the trustee does not want your furtniture and other things you would sell at a garage sale.

[nioka]

LadyInTheRed

The neighbors now inform me they will be able to pay by the end of the year. As I will receive this money, ($1000), prior to filing is it mine to use or do I need to put in my bank account. (I thought of using it to pay my attorney or new dentures).

All my CC's are up to date with only my mortgage payment late for the first time. I thought I would file sometime next month.

I guess I should not try to sell anymore furniture until 30 days after my 341 as you mentioned.

[LadyInTheRed]

LadyInTheRed

The neighbors now inform me they will be able to pay by the end of the year. As I will receive this money, ($1000), prior to filing is it mine to use or do I need to put in my bank account. (I thought of using it to pay my attorney or new dentures).

You can spend it on living expenses (including dentures) or attorney fees up to the date you file. Just make sure you don't have non exempt cash on the day you file.

I guess I should not try to sell anymore furniture until 30 days after my 341 as you mentioned.

Ask your attorney about selling assets after you file and before the case is closed. There is no reason you can't sell furniture before you file.

[nioka]

LadyInThe Red,

Thank you very much.

[tobee43]

we sold out entire household prior to filing ....almost everything. we were never asked although we used that money for our move and to get set up in another state. our atty said prior to filing we had a right to sell whatever we wanted. we also rec'd a HUGE refund from the irs in thousands and was advised to spend it prior to the 341 so it's gone. the court can't take what is not there or what you spent prior to filing unless you commit fraud. which is still difficult to prove in a court of law.

we did not commit fraud by selling everything we own to make our move, nor spend the thousands on our household expenses, (food, car, utilities etc.). we needed to liquify to support what we were doing.

lady points this out...clearly and i whole hardheartedly agree.

[nioka]

tobee43,

Thanks for the post.

When you sold your emempt items prior to filing were you able to put the money in the bank?

Secondly If I were to put the money from the sales of my exempt items prior to filing my bank account would not look too shabby. I don't like the idea of keeping cash around the house.

I believe in TN a person can have up to $10k in exempt items and cash. I doesn't seem to make much sense if a person as a car worth $4k and $6k in the bank to be filing for bankruptcy. When I think of Donald Trump's bankruptcy I scratch my head in wonder.

[keepmine]

You need to be certain of the $10K figure. Is that what you lawyer told you?

BTW, Trump never filed a personal bk. Trump Towers and Casinos has filed a Chapter 11 twice over the years.

[nioka]

Keepmine,

Yes, the two attorneys I talk to so far both said in TN a person filing for BK can have $10k in exemptions and cash.

There is also an issue with what funds go into that bank account. I have SS and and ERISA pension both which are protected. However, it is my understanding that if I deposit funds that I cannot prove to be exempt then the bank account may lose its protection.

This is why I question putting funds from garage/yard, or home item in the bank. I also guess this is the reason I read many posts that say spend it.

For a person like me, and many others, who have spent a life time with the philosophy of work hard, pay your bills, save, and everything will work out, trying to grasp the rules of bankruptcy is tough.

[keepmine]

You could always open an account at another bank and only use that proceeds from the sale.

[tobee43]

tobee43,

Thanks for the post.

When you sold your emempt items prior to filing were you able to put the money in the bank?

Secondly If I were to put the money from the sales of my exempt items prior to filing my bank account would not look too shabby. I don't like the idea of keeping cash around the house.

I believe in TN a person can have up to $10k in exempt items and cash. I doesn't seem to make much sense if a person as a car worth $4k and $6k in the bank to be filing for bankruptcy. When I think of Donald Trump's bankruptcy I scratch my head in wonder.

no!! we keep it in our pockets for our move. get a small safe, we did also. donald had a different type of bk then u and me lol! if a persons car is over the exempted about the trustee allows one to buy back the asset, that is the worse thing that can happen.

[Pjmax]

Someone will correct me if I'm wrong, I'm sure, but I believe your exempt items will also include household items, computers, electronics, clothing, jewelry, etc., so it's more than just a car and cash.

It's a good idea to not mix any other funds with your SS and pension, until after you've filed, just in case. It's only for a few months, use your yard sale cash for Xmas gifts, groceries, or pay your attorney with it.

And, please put the credit cards away, or cut them up. Why risk an AP from a CC company? You may be asked at your 341 meeting when was the last time you used a credit card.