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Maverick
Maverick, Attorney
Category: Bankruptcy Law
Satisfied Customers: 3431
Experience:  Bankruptcy Law With An Accounting Degree - 13 + years as civil lawyer
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Hello I lik I filed for Chapt 7 in FL and my vehicle was appraised

Customer Question

Hello I lik
I filed for Chapt 7 in FL and my vehicle was appraised at $9k was listed on my schedule as $7k and I took a $1k exemption. The Trustee valued the vehicle at $11k, 12 and 13k based on Kelly Blue book and offered to sell the vehicle to me. I signed a buy-back contract to purchase the Vehicle for $5k no int for 1 year. 4 wks later, I received a letter stating that the Trustee has the option to entertain other offers withing 20 dys the objection period and the contract can be withdrawn at any time. The Trustee has listed the Vehicle for sale and has already taken a downpayment from a prospective buyer who has been badgering me to see the vehicle. I have shown him the vehicle twice and he has informed the Trustee that I am not cooperating. In addition, the contract stated that the vehicle is being sold as is and the Trustee is making no warranty about the vehicle. The 20 dys objection period has passed, however, the Trustee says she can extend the time. What is my recourse
Submitted: 4 years ago.
Category: Bankruptcy Law
Expert:  Maverick replied 4 years ago.
When you file BK, you are a debtor in possession. This means that your assets do not belong to you, but rather that they belong to the BK estate which is controlled by the trustee.

Section 323(a) provides that the chapter 7 trustee is the representative of the estate. The trustee is a fiduciary charged with protecting the interests of all estate beneficiaries - namely, all classes of creditors, including those holding secured, administrative, priority, and non-priority unsecured claims, as well as the debtor's interest in exemptions and in any possible surplus property.

The trustee should administer the estate so as to maximize the distribution to the beneficiaries. To represent the estate, the trustee must secure for the estate all assets properly obtainable under applicable provisions of the Bankruptcy Code, object to the debtor's discharge where appropriate, defend the estate against improper claims or other adverse interests, and must liquidate the estate as expeditiously as possible for distribution to creditors.

If you do not comply with the trustee or if it is perceived that you are not cooperating with the liquidation of estate assets, the trustee can get a court order and have you turnover the car to him under Section 542.

So, what you have is a case where the trustee has a duty to maximize payment to the creditors and while you still get to claim the exemption amount. However, where the value of the collateral exceeds you exemption amount, the trustee has a right to sell it and pay you the exemption amount and pay distribute the remainder to the creditors.
Maverick, Attorney
Category: Bankruptcy Law
Satisfied Customers: 3431
Experience: Bankruptcy Law With An Accounting Degree - 13 + years as civil lawyer
Maverick and other Bankruptcy Law Specialists are ready to help you
Customer: replied 4 years ago.

Sir, I have complied with the Trustee's request and have shown the Gentleman the vehicle twice. The prospective purchaser has complained that I am not cooperating with him which is not true. He wants to bring a mechanic to see the vehicle and I had suggested a time and the mechanic was not available. I had a death in my family and therefore could not accomodate him and told him to call me back to schedule another time.

 

Anyway, can I file an amended schedule and take the additional exemption of $4k on my vehicle?

 

Thanks for your timely answer.

Expert:  Maverick replied 4 years ago.
<p>Sorry, I was not meaning to imply that you had not complied, but if the trustee <strong>perceives</strong> that you are not and he does not know the details, he may act under 542 unless you let him know. It appears that that is why he is wanting to extend the time so that your schedule and the potential buyer's schedule can be accomodated.</p><p> </p><p>Yes, you should be able to file the amended schedule and take the exemption anytime before discharge under BK Rule 1009. However, it is best to do so as soon as possible and before the time for the creditors to object to exemptions passes.</p><p> </p>
Customer: replied 4 years ago.

Thanks for you GREAT Reply. I own the vehicle outright and l already had a meeting with the creditors. I filed for bankruptcy pro se.

 

 

Thanks again for you time and advice. I really do appreciate it; you helping out the "poor" Have a GREAT day!

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