On a bankruptcy petition, a value is a statement made under oath. Every home, car, account, and household item on Schedule A/B needs a figure, and the trustee will check it. A value that is too low invites suspicion that equity is being hidden. A value that is too high can mean needless complications for the debtor. For the bankruptcy petition preparer or virtual bankruptcy assistant learning to value property on a bankruptcy petition, the answer is simple: never guess. Use a reliable source, write down where the number came from, and flag anything uncertain for the attorney.
This guide shows where to find defensible values for each type of property, how to document them, and which public records to search before a petition goes to the attorney.
Why values matter so much
Values drive three things on a petition. First, they decide how much equity the debtor has in an asset (value minus liens). Second, equity is compared against the exemptions on Schedule C to see what the trustee may be able to reach. Third, the attorney uses the numbers to choose a chapter. If you want background on exemptions, read A Quick Lesson in Bankruptcy Exemption Allowances and Exemption Check: Saving Time on Your Petition.
Remember that the form asks for the current value of the portion the debtor owns. A debtor who owns half of a house reports half the value. Deciding whether a particular exemption applies is the attorney's job. Yours is making the numbers solid.
Real estate
- Start with the county. The county assessor, appraiser, or auditor website shows the parcel, legal description, owner of record, and assessed value. In many places you can also see recent sales.
- Remember that assessed value is not market value. Assessments can lag the market or follow a formula. Use them for identification and a cross-check, not as the final number.
- Look at recent comparable sales of similar homes nearby. Real-estate portals can give a starting point, but their automated estimates can be far off, so treat them as one data point.
- Check the liens. Use the debtor's mortgage and home-equity statements, and search county records for judgment liens, tax liens, and second mortgages the debtor may have forgotten.
- If the value is contested or the equity is close to an exemption limit, tell the attorney. An appraisal or a broker's price opinion may be worth the cost.
Vehicles
Vehicles are among the most-checked assets, because trustees look them up as a matter of routine. Use a recognized pricing guide, such as Kelley Blue Book, J.D. Power (formerly NADA), or Edmunds, and enter the details accurately:
- The exact year, make, model, and trim, and the VIN if you have it
- Mileage at or near the filing date
- Condition (be realistic: ask the debtor about dents, interior wear, and mechanical problems)
- The kind of value being reported (private-party, trade-in, or retail)
Ask the attorney which standard they use. Practice varies by district, and for personal property that secures a loan in Chapter 7 or Chapter 13, the Bankruptcy Code uses replacement value (roughly the price a retail merchant would charge). Whatever standard the firm chooses, apply it consistently and note it in the file. Print or save each valuation page with the date. For related guidance see The Means Test and the Older Vehicle Deduction.
Household goods, electronics, and jewelry
The question here is what a stranger would pay, not what the item cost or what it would cost to replace. Think garage sale or used-goods marketplace. Group ordinary furniture and appliances by room or category; list valuable or unusual items (a collection, a musical instrument, a high-end TV) separately. Jewelry deserves special care: see How to Properly Record the Debtor's Jewelry on Schedule B. Phones and tablets are easy to forget and easy to price: Tips for Inputting Cell Phones on Schedule B.
Bank accounts, retirement accounts, and other financial assets
These come straight from statements, not estimates. Use the balance on the filing date (or the closest statement) and list every account, including savings, credit-union, and payment-app balances. For retirement accounts, record the account type and the statement balance, and let the attorney handle how it is treated. Our tips on inputting a 401(k) on Schedule B and PayPal accounts and bankruptcy cover common questions. A tax refund the debtor expects is also an asset; see Tax Refunds: How Does This Money Affect Your Cases?
Business interests and self-employment
If the debtor owns or co-owns a business, check the Secretary of State business search for the entity, and ask for an equipment list, inventory, accounts receivable, and recent profit-and-loss statements. Tools and equipment are assets and often have exemptions of their own, but that is the attorney's call.
Public records every preparer should search
Good due diligence catches what the debtor forgot. Before you send a draft to the attorney, consider searching:
- PACER, for prior bankruptcy filings under the debtor's name, spouse's name, and any former names. A prior case can affect eligibility and the discharge, so flag any hit immediately.
- County recorder or land records, for deeds, mortgages, liens, and judgments
- Court records, for lawsuits and judgments against the debtor
- Secretary of State UCC filings, for liens on business assets or equipment
- Property records for prior addresses, because debtors sometimes still own a property they moved out of, or co-signed something years ago
- Vehicle title records, where permitted and with the debtor's authorization
Our post on online discovery methods expands on this, and 2 Must-Have Items Before Drafting a Bankruptcy Petition explains why preparation matters.
Document every value
Use a one-page valuation log for each petition with these columns: asset, value used, source, date checked, who provided it. Save a PDF of every web page you rely on. When the trustee asks, “Where did this number come from?”, the attorney can answer in seconds. It is also strong marketing: attorneys love a VBA who hands over the petition with the backup.
What to do when sources disagree
Different guides will give different numbers. Choose the figure you can best defend (not the lowest or the highest), write down the others you considered, and flag the discrepancy for the attorney. If the debtor insists a value is much lower or higher than your sources, record what they said and why, and let the attorney decide.
Want to know if your valuations hold up? A bankruptcy petition review checks your finished petition for consistency and exemption completeness before it goes to the attorney, so problems are fixed before the trustee sees them. To learn every schedule step by step, explore the Chapter 7 & 13 training and certification system.
Frequently asked questions
Should I use the lowest defensible value?
Use the most defensible value, and be able to show where it came from. A value that is too low without support is the kind a trustee questions.
Can I rely on an online home estimate?
Treat it as one data point alongside county records and recent sales, not as proof.
Who decides if equity is exempt?
The attorney. You provide the numbers and flag questions.
This article is general education for bankruptcy professionals, not legal advice. Valuation standards and exemption rules vary by court and state, so confirm the approach with the supervising attorney. Questions about our courses? See the FAQ.