After a Chapter 7 debtor attends the 341 meeting of creditors, s/he may receive a notice in the mail from the court regarding abandonment. This is a great point of confusion for clients so let’s explain.
Upon the filing of a bankruptcy petition, the debtor’s assets come under the control of the court and the bankruptcy trustee. If there is a significant asset with value, the trustee may decide to sell that asset and distribute that money to the debtor’s creditors. In determining that, the trustee will review the petition, require documentation to be submitted prior to the meeting of creditors and question the debtor at the meeting of creditors. S/he may also elect to do further investigation. If the trustee concludes that there is no asset of value, s/he will elect to abandon his/her interest in the asset.