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What Bankruptcy Furniture Is

Bankruptcy Furniture can be a bargain for some.

When a company or individual declares bankruptcy, then the courts will order that some or all of their assets may be sold off at auction to help reduce their creditor liabilities. In most cases the bankruptcy furniture is shipped to a central auction room and sold off, usually in small lots. Especially if we are talking about a large company that has gone into liquidation. The individuals' furniture is sold off on site, usually at knock down prices. The reason being that individuals can request that some of their articles of furniture not be sold off, and be deemed exempt under chapter 7 bankruptcy. Companies are not entitled to this privilege.

There are many individuals who have made it their business to find where this bankruptcy furniture will be sold off, and often buy them up in quantity. This is a totally legitimate procedure. They follow announcements made in certain websites and local press and make it their business to be on site early to check out the quality and condition of bankruptcy furniture to be sold off. They make it a practice to be as inconspicuous as possible, and generally will not bid for small lots. Instead they will let the public pick off a few of the bargains, and then try and buy up what is left at next to nothing prices. Their hope is that the liquidators will have not set a reserve price and they can get a real bargain. When they calculate the price they are prepared to pay, the buyers will need to take into account the real market value of bankruptcy furniture against cost of handling, advertising and selling the items on sale.

Individuals who are considering the option of filing for chapter 7 bankruptcy will be relieved to know that in most instances their personal furniture and personal effects will be excluded from being considered as bankruptcy furniture. This is a compromise situation set out by the courts to allow the person declaring bankruptcy to have a normal life as possible while their bankruptcy remains undercharged, especially if there are children in the house. However the court will use it discretion when it considers that the value of the furniture is such that it can be sold off to reduce creditor liabilities and furniture of lesser value be acquired in its place.

Once again the simple rule of thumb is that someone who is considering bankruptcy must realize that this is no simple step and sacrifices may have to be made. One of them may be selling of items of bankruptcy furniture that may have sentimental value, but also a financial value that will be needed by the creditors to offset their losses.

Emma White is the creator of officialbankruptcy.com which is dedicated to bankruptcy, credit problems, and other debt related issues. Find out more here http://www.officialbankruptcy.com now..... Free bankruptcy eBook for all visitors

Source: www.articlesbase.com