QUESTION
Am I going to lose my 1/3 share of the profits if I listed and sold my house about 4 days after receiving my discharge papers?
Asked on Oct 24th, 2016 on Bankruptcy - Colorado
More details to this question:
I asked my bankruptcy attorney in April when I could sell my house. The meeting with the creditors took place May 17. He told me I shouldn't have any problems if I listed it in July. I listed the house on September 4th, 2 days after receiving the discharge papers, and sold it 4 days later. I own a 1/3 interest in the property (the other 2/3 were not included in the bankruptcy). The house is supposed to close Friday, October 28, but as of last Friday, I found out that the BK case is still open, and the trustee filed some papers in regards to "distribution." Friday was the first time I had ever been told about the case still being open. I thought the case was over when I received the discharge. My bankruptcy attorney says he is working on the issue, but has not been communicating with me. There is a total profit after closing expenses of about $60,000. We put about $20,000 into the house getting it ready for sale, between supplies and labor.
4 ANSWERS
Commercial & Bankruptcy Law Attorney serving Powell, OH
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Ronald K. Nims
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If you disclosed the property value and any liens accurately in the schedules. You can sell it anytime after the trustee abandoned it. If your schedules were false - say you said the house was worth $20,000 then sold it a few months later for $60,000 then you need to amend the schedules.
Answered on Nov 28th, 2016 at 5:33 AM
No your case is not closed until the trustee files paperwork with the court. The discharge only lifts the stay. The way this should have been handled would be to obtain written permission from the trustee to sell the property. Escrow will not close without the trustee's involvement. Also not sure how you were able to exempt your interest in this rental property. Sounds like you need to take your file to another bankruptcy attorney to review and expect to pay a consultation fee.
Answered on Nov 22nd, 2016 at 4:39 PM
1 Award
Your attorney needs to file a motion to compel abandonment to have the home removed from the bankruptcy estate. Even though the case has discharged it has not closed.
Answered on Nov 22nd, 2016 at 4:39 PM
In my opinion (based on 35 years of filing BK's), you will need to meet face to face with an experienced BK lawyer. I have a two hour minimum as an example ($500). The lawyer will have to review your entire BK file to properly advise you. Going to a website like this is fine for simple, straight forward kinds of questions. Specific questions like your question is "fact intensive", if that makes sense. Good luck!
Answered on Nov 22nd, 2016 at 4:38 PM