chapter 7

A Chapter 7 bankruptcy trustee is supposed to gather and sell all non-exempt personal property of significant value. Sometimes there are practical considerations that lead most trustees to leave valuable assets for the debtor.

One of my Chapter 7 bankruptcy clients owned a military-grade machine gun. The stated that the machine gun was worth at least $8,000. The machine gun would be non-exempt in this debtor’s bankruptcy.

It’s well-established that a corporation has an attorney-client privilege and can assert it to keep communications between the corporation and its attorneys confidential. When a corporation is solvent, its officers and directors maintain the right to assert — or waive — the attorney-client privilege on behalf of the corporation, and control who has access to privileged communications.

I received an inquiry from prospective bankruptcy clients who had moved to Florida from New York just over six months and had purchased jointly a Florida homestead. The wife had substantial unsecured debts and wanted to file Chapter 7 bankruptcy.

Did you know that your time in Chapter 7 is an ideal time to negotiate extremely favorable buy outs or payment terms for secured debts?  Because you have the option to surrender secured collateral that may have lost significant value, secured creditors are usually willing to accept pennies on the dollar.

I have reported previously on this blog that Wells Fargo Bank often will freeze bank accounts of its depositors who have filed bankruptcy even if the debtor claims the money in the account as exempt property on their bankruptcy petition. Wells Fargo bank often requires a letter from the bankruptcy trustee to give the debtor, and even his non-debtor spouse, access to the debtor’s money.