No, not debt collections, I’m talking about personal collectibles. Probably everyone has heard the urban legend about the baby boomer whose parents threw out his baseball-card collection that had a priceless Honus Wagner among them. Contrary to the parents’ perception that it’s just junk, collectibles of all kinds can be quite valuable. In fact, people facing financial difficulties might be tempted to sell them off to pay bills. Thus, the question is what happens to personal collections in a New York bankruptcy?
On the one hand one might think that a chapter 7 bankruptcy trustee would not care about collectibles. Collections aren’t necessarily as fungible as money in a bank account, and buyers might be scarce. However, the bankruptcy system takes them quite seriously. In fact, Schedule A/B, which debtors must submit with their bankruptcy petitions, requires debtors to list any, “collectibles of any value.” The list of examples includes:
- antiques and figurines;
- paintings, prints, or other artwork;
- books, pictures, or other art objects;
- stamp, coin, or baseball card collections;
- other collections, memorabilia, collectibles
(It’s amusing that baseball cards are ubiquitous enough to merit acknowledgment in the bankruptcy schedules.)
Schedule A/B then asks debtors to give the “current value of the portion you own,” which is what exactly? Not the book value for what they purchased it years ago, but its current market value, but how do you calculate that? At this point, it should be clear that the trustee is probably not going to be an expert numismatist (coin collector) or whatever, and he or she won’t be interested in hiring one unless it’s necessary. Rather, the debtor will price the collection based on what it would sell for, probably based on eBay or some other auction Web site. (Valuing assets is just one more way the Internet has made bankruptcy easier for debtors.)
A debtor would be sure to produce the source of the valuation along with the bankruptcy schedule. If the Internet isn’t sufficient, then information from a book estimating the value of the collectibles might suffice, e.g. the Beckett almanac for baseball cards, and if worse comes to worse, debtors can always obtain an expert valuation. Although it’s possible to list a collectible’s value as, “unknown,” it’s discouraged because it will merely lead to further inquiry by a curious trustee.
Fortunately for debtors, different exemptions can protect different collectibles—though they may not worth it. Notably, the New York State exemptions give debtors $550 for books and $1,100 in jewelry (which can include artwork). There are of course cash and wild-card exemptions. Click here to read more about the applicable state and federal exemptions.
Debtors can probably find a better price for their collectibles if they have the time to sell them before bankruptcy, but if that isn’t the case for your financial situation, then talking to an experienced New York bankruptcy lawyer can help you assess your options about valuing and keeping your collectibles.
For answers to more questions about bankruptcy, the automatic stay, effective strategies for dealing with foreclosure, and protecting your assets in bankruptcy please feel free to contact experienced Brooklyn bankruptcy attorney Bruce Weiner for a free initial consultation.
