Schedule B is a complex and tedious form. Gathering information for this form can be time consuming for the debtor and attorney. All personal property must be listed, no exceptions.
Breakdown of Schedule B
Type of Property
This section includes things such as:
- Financial Accounts, Stocks, Etc.
- Household Furniture and Goods
- Insurance Policies
- Interest in Education
- Business Interests
The list is extensive and can be overwhelming for debtors to fill out. A debtor should give a monetary value for everything he or she owns and provide documentation such as titles, deeds and statements to support the value of these items. There generally are no exceptions and debtors will need to provide these documents.
Tip: At your first client meeting, ask the debtor to find and organize all financial documents including titles, certificates, bank statements, deeds, etc. When it’s time to complete the client intake form and attach copies of all the necessary documentation, the debtor won’t feel so overwhelmed.
Tip: Consider sitting down with your client to help figure out the value of their personal belongings. Most debtors have a hard time putting a value on personal property, especially things such as pets.
Description and Location of Property
Items must be listed along with their location, such as debtor’s residence or in storage. If it’s a financial document, the company issuing it should be included.
Tip: You don’t have to list each individual item when it comes to bulk things like clothes. Usually grouping items such as “men’s shirts, pants and sweaters” will suffice. Be sure to include the estimated value of the grouped items.
Tip: It can also be very helpful to make notes to the trustee in this section. For example, if the debtor has a car it could look something like this:
2010 VW Passat; located at debtor’s residence; Note: Title is in Co-Debtor’s name but financing was done by Co-Debtor’s mother. Chase Bank holds the title.
Adding this bit of information will save the trustee from having to request it later if there’s a question.
Husband, Wife, Joint or Community
This section should detail who owns the property. In some cases it’s divided between the wife and the husband if they are going through a divorce and paying claims separately.
Tip: Be as specific as you can when dividing up claims. It can be very difficult to get money back from a creditor if it’s mistakenly paid.
Current Value of Property
This is the debtor’s interest in the property, not the secured claim amount or exemption. Generally, personal property is required to be valued using the Retail Replacement Value (the price a retailer might charge for similar property taking into consideration the age and condition of the property). Keep in mind, that Retail Replacement Value is not the cost of replacing items with new ones. It is basically how much it would cost you to replace those items with items of the same age and condition on the date you file for bankruptcy. Different types of property may require different methods for determining value. For example, vehicles could be valued using a trade publication, an appraisal, or comparable sales prices.
Tip: This is generally the hardest section for the debtor. Things like clothes, old furniture, and animals are hard to value. There are websites and resources that can help a debtor value personal property.
Total Value of Property
Always check your math when adding columns and make sure you’ve included every page. You can add additional continuation sheets and/or attach your own additional sheets if needed. Don’t leave something out because you ran out of space on a page.
Tip: If you’re attaching your own sheets, make sure it contains the same description information as the original schedule so there isn’t any confusion regarding the information.
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VPS provides paralegal and legal support services and is not engaged in any way with the rendering of legal advice. VPS encourages readers to obtain the advice of competent, licensed legal counsel as required. Any information provided by VPS is not a substitute for legal advice or assistance.