Again, the value is set at used prices, not retail. Anyone who's ever tried to sell a couch knows the value isn't high, even for excellent quality furniture in like-new condition. But when it comes to boats, jewelry or furs, the story is different. Those almost always must be disposed of by the trustee. But the best market for the item may be the person going through the bankruptcy.
Trustees often sell property back to someone who's in the process of declaring bankruptcy.
That's fraud and the penalties for the crime are severe. Once the petition is filed, all of the creditors are notified of the pending bankruptcy. A date is set for a meeting of the creditors. It's the one time when the individual has to go to the federal court with his or her attorney. The trustee presides over the meeting and asks the debor a series of 30 to 40 standard questions.