Sometimes the debtors forget to list some of their assets. An example of this might be a person who comes in and just happens to forget that he has a diamond ring that he actually bought for more than $10,000.00 for his girlfriend. He plans on gifting it to his girlfriend as their engagement. However, this is something that you should list. Now, whether the trustee is going to go after this engagement ring is another question. However, this is something that needs to be listed. This way, if something ever does happen, your lawyer can actually protect that diamond ring with the $4,000.00 exemption, or he can make sure that the value — the resell value which he can realistically sell that diamond ring for — is less than the exemptions that you have. That way it’s covered.
However, if the trustee does decide to liquidate the diamond ring to pay back some of your creditors and your exemptions don’t protect you, then you still have a couple of options. First, you have to realize that the ring that was bought for ten thousand dollars is not worth that much any more. The resale value might only be six thousand dollars now. Therefore, your exemptions would have to cover only six thousand dollars. So let’s say you put the four thousand of the wildcard exemption into that ring and there is only two thousand left un-exempt. You have an option of offering the trustee the two thousand dollars that he would have made upon selling the ring. You might be able to borrow this money from your relatives and keep the ring. Basically, the principal behind this logic is simple. If you give the trustee whatever he could have made upon the liquidation of the property, he will let you keep that property.

Bankruptcy Lawyers Austin