Schedule D is part of a series of documents a debtor files with the bankruptcy court. It is formally called "Official Bankruptcy Form 106D" or "Schedule D - Creditors Who Have Claims Secured by Property."
Unlike unsecured debts like medical bills or credit cards, secured debts have collateral like cars and houses. The creditor has a lien on your property, or a right to seize the property if you fail to pay your loan or otherwise default on the obligation. Similar to the other bankruptcy schedules, it is essential to a successful bankruptcy to fill out Schedule D correctly and in full.
You can access the official Schedule D form. You can fill it out on the U.S. Court's website, but you can't save it there. Be sure to download it to your computer after you've filled it out.
Before we take a look at how to fill out the form in its entirety, here's a look at how courts define a secured debt.
What Is a Secured Debt?
Before you begin filling out Schedule D, you must determine which of your debts may be subject to a secured claim. Secured claims include car loans and mortgages, but they can also include loans to purchase other big ticket items like a boat or equipment for your business. It can also include retail purchases like appliances, furniture and jewelry. Some retailers routinely take a security interest in your purchase. This is common at electronics and furniture stores. If you're unsure, you should check the other side of the receipt you signed when you made the purchase.
If a creditor sued you and obtained a judgment, the judgment is considered a secured debt because it gives the creditor certain rights in your property.
Some liens come into effect just because of the nature of the circumstance. For instance, if someone remodels your house or provides materials for the project, that person has a lien on your property until you pay what you owe. This is called a mechanic's or a material man's lien.
Once you've figured out whether a creditor has a claim against a piece of property you own, you'll need to fill out Schedule D.
Filling Out Schedule D
Schedule D is divided into questions and parts.
At the top of the page, you'll have to identify any and all debtors who are part of the claim. You will also have to list the bankruptcy court where the case was filed, along with the case number. You can then proceed to the first part of the form.
Question 1: This questions asks whether you have any secured debts. Check "no" if you don't. If you do, check "yes" and continue on to Part 1.
For each debt, you'll list information that identifies the creditor and describes the debt.
List the name of your secured creditor and the contact information. You may use the payment address if necessary, but it's better to look on a statement or your contract for the bankruptcy, inquiry or customer service address.
The Property or Collateral
List a description of the collateral. For example, 2010 Toyota Prius, residential property at 100 Elm Street, Dallas. or John Deere tractor.
Identify which debtor listed from the top of the page is liable for that particular debt.
Nature of the claim
You can mark if you dispute whether you owe the debt, if the debt is contingent (like a guarantee that you'll pay if the primary debtor doesn't) or if the debt is unliquidated — meaning you don't know the amount.
Type of Lien
Here you'll mark the type of lien. See the explanation above to determine the type of lien on your debt.
List for each debt:
- the balance
- the value of the collateral
- the unsecured portion, if any. If you owe more than the value of the collateral, this is the amount above the value. For instance, if your car is worth $10,000, but you owe $12,000 on it, the unsecured portion is $2,000.
Your attorney can help you figure out how much your collateral is worth. For a house, it is often sufficient to list the value on your county tax rolls. You can also use a recent appraisal or a broker's price opinion. For a car, there are many online services–like NADA, Edmond's and Kelley Blue Book–you can access for free. The same applies for boats, RVs and other equipment.
It's a bit more difficult to estimate the value of household furniture and appliances because there isn't a standard value. You may have to guess and later negotiate with the creditor on the value, if necessary.
If you need to notify anybody else connected with these debts, you'll enter their contact information here. You can include bill collectors and law firms in this section as well. (To learn about other documents filed in a bankruptcy case, visit Basics of the Bankruptcy Schedules.)
The Bottom Line
Bankruptcy can be a very frustrating process. But with the right information, you can cut back on some of the stress associated with it. Be sure you fill out all the forms required, including Schedule D. If you're filing as an individual, you'll need the correct schedule, so make sure you're choosing Form 106D. You'll need to list any creditor who may have a claim against you secured by property. In order to avoid any hassles, make sure you fill out the form correctly and in full. And do your homework in order to get the most accurate figures for any collateral you're listing. When in doubt, check with a professional.