When a debtor receives a “Notice of Abandonment” from the trustee, they should not be alarmed. The title of the document oftentimes scares debtors into thinking they are going to lose the property listed in the notice, which is not the case.

Basically, a notice of abandonment is the trustee’s way of saying that for one reason or another, the listed property cannot be liquidated for the benefit of your creditors. When a bankruptcy case is filed, real and personal property become part of a “bankruptcy estate” which the trustee is in control of. Once the trustee reviews the case and determines he cannot make any money for creditors by liquidating specific assets, they will file an abandonment notice on these items.
Even if your property is covered by exemptions, it is still considered part of the bankruptcy estate until the trustee abandons it.

The most common reason the trustee abandons an asset is because it is burdensome to the estate. For example, if you have a car worth $10k but owe $15k on it, the trustee will abandon the car because if he were to sell it he would have to first pay off $15k to the vehicle lender. If the car is only worth $10k, there would be no money left over to pay any other creditors. The same is true for real estate. If you owe more than your home is worth, or if the costs of selling the home (ie. Realtor fees etc.) eat up any money available for creditors, then the trustee will abandon the asset back to you.

Upon abandonment, the property is yours to do with what you choose and is no longer part of the bankruptcy process.

For more information regarding Notices of Abandonments, or for other bankruptcy law questions, contact The Larkin Law Firm at http://www.live-debt-free-now.com

Author's Bio: 

Jeffrey D. Larkin is one of the most productive debt-relief attorneys in the region. His innovative law firm is committed to providing intelligent debt solutions custom fitted to his clients' individual needs. Whether you need to file bankruptcy, re-organize your debt or re-build your financial structure, Mr. Larkin provides a full range of legal services designed to restore financial order to your life.

Mr. Larkin is a California licensed attorney offering services throughout San Diego, Orange, Riverside and San Bernardino Counties. A 1998 graduate of California State University, San Bernardino, Mr. Larkin earned his Juris Doctorate from Thomas Jefferson School of Law in 2002. Since that time, Mr. Larkin has focused exclusively on bankruptcy and insolvency related matters, and has authored dozens of articles regarding bankruptcy and other debt solutions.

From 2002 through 2009, Mr. Larkin served as an associate attorney for the two largest bankruptcy filing firms in San Diego County. During that time, Mr. Larkin handled thousands of cases, and gained invaluable experience serving a broad and diversified client base. In 2008, Mr. Larkin was one of the top five bankruptcy filers in all of San Diego County, according to the United States Bankruptcy Court, Southern District of California.

You can reach Mr. Larkin by e-mail at Jeff@larkinfirm.com or by phone at (760) 692-2269. For more information about The Larkin Law Firm, go to Live-Debt-Free-Now.com.