Property Value Increases in a Chester Bankruptcy

You can have a bankruptcy filed and then, while in bankruptcy, the estate appreciates in value.  So, who "owns" the appreciation?  

First, a Chester County bankruptcy lawyer should determine if the asset is exempt -- if through 522(d) then the appreciation is the debtor's property.  If, however, the debtor can only exempt his interest in the property, then any appreciation beyond the exemption goes to the bankruptcy estate.  

Even when the debtor's initial interest is listed on the petition properly, the change can still hurt the Chester County debtor down the road.  This can allow the trustee to seek to liquidate the asset to get the non-exempt amount.  

Reality of Appreciation

Now, this rarely happens.  A hypothetical would be if you had a penny stock and the stock went through the roof during the bankruptcy.  For example, if you had a thousand shares at $1 and the shares all of a sudden went up to $100.  Now, you have $100,000.  The trustee could seek to sell the stock and repay the creditors accordingly.  

In the end, the law makes sense but rarely does this happen.  If anything, property depreciates under a bankruptcy.