For many Baltimore residents considering debt relief options, the ultimate fate of personal possessions may be a genuine concern. Many personal items have individual value that goes beyond the price they might fetch at auction or resale. With so much of our personal lives captured as electronic information these days, even an old and out-of-date computer can hold information and memories valuable only to the owner. These types of concerns may have some wondering how filing for personal bankruptcy will affect their ability to keep items of personal property.
As a general rule, creditors are not interested in used items of personal property. Credit card companies, for example, are not equipped to seize, store and resell large quantities of used consumer goods. Items that are secured by a loan agreement, however, may be repossessed by creditors. Cars, recreational vehicles, and even items like furniture and jewelry may be subject to repossession if they are collateral for a loan.
Although creditors may not be interested in used personal items, the bankruptcy trustee appointed by the court has a duty to identify assets that can be sold to satisfy outstanding debts. In some cases, the trustee will only pay attention to assets that have reasonably significant value and will not bother to come after a person's used television or worn furniture. In other cases, though, a trustee may get overzealous in attempting to martial assets. Fortunately, Maryland law provides a set of express exemptions that allow people to keep certain types of property in every bankruptcy proceeding.
The exemptions available under Maryland bankruptcy law allow filers to keep up to $7,000 worth of personal property and necessary household items in addition to another $5,000 worth of items necessary to a person's job or trade.
Other exemptions apply to prescription medical products and devices, certain retirement account interests and proceeds from insurance policies or lawsuits. An experienced bankruptcy professional can help Marylanders maximize the benefits of bankruptcy by making certain that exempt property does not fall into the hands of an overreaching trustee.