Many readers in New Jersey know that when they file for personal bankruptcy, control of their assets goes to the trustee assigned to their case by the court. The trustee, in some cases, can sell assets in a personal bankruptcy to gain money to repay creditors. Recently, such assets have begun to be sold online through marketers such as Ebay as efforts to recoup creditor funds have intensified.
According to one report, approximately $2 billion in assets are involved in Chapter 7 bankruptcy filings in New Jersey and across the country each year. In addition, as much as $10 billion in assets from Chapter 11 cases are handled by bankruptcy courts. Some of those assets must be sold to pay debts and many of those sales are now being conducted online. For example, at least one famous football player had his sneaker collection sold online by the bankruptcy trustee to help pay his debts to creditors.
Ebay is the world’s largest Internet marketplace and serves as an excellent online auction resource for bankruptcy trustees in the selling of assets, according to a recent report. The online site allows trustees to access potential buyers of debtor property from all over the world. This has increased the amount that is recovered for personal bankruptcy creditors.
Though some assets may not be available to be sold by the trustee in a personal bankruptcy, the courts typically have the final say on what property can be resold to pay back creditors. When this happens, it is becoming more likely than ever that the trustee might turn to online auctions for large property sales. However, it is important to note that anyone filing for personal bankruptcy in New Jersey may be eligible for many exemptions that will allow them to keep certain property when such a filing occurs.
Source: businessweek.com, “Bankruptcy Auctions Go Online to Boost Cash for Creditors,” Dawn McCarty and Phil Milford, Sept. 28, 2012