Bankruptcy Law Questions? Ask a Bankruptcy Lawyer Now.
Hi and thank you for your question. In the future, you can request me to answer any further questions.
A chapter 7 case lasts usually about 90 days in most cases.
If the asset was disclosed, the trustee will make a determination if the asset can be liquidated to pay the bankruptcy estate.
If not, they will issue a no asset report, and once the case discharges, the assets are returned to the debtor who filed.
If the debtor hid the asset from the bankruptcy trustee by not disclosing their interest, then the case can be reopened, the property can be brought back into the bankruptcy estate, and can be liqudated.
If the property was already sold or transferred, the trustee could file suit to reverse the process.
Any subsequent buyer would have a claim against the debtor for breach of contract and damages though.
Therefore, if you are looking to buy, request a copy of the bankruptcy case to see that it was listed or not, then request a copy of the discharge.
Once discharged, you can call the trustee to confirm that it was released in the bankruptcy. (The trustee may keep the case open to liquidate the asset - but the discharge will still be entered)
IF that is the case, then you can purchase it from the trustee instead of the debtor.
Have your real estate attorney review the matter so that you can make sure you'll be taking clean title.
Thank you for your question, good luck.
How does one go about getting copy of Bankruptcy records? What if interim, are they public records before dismissed?
All bankruptcy documents are public information.
You can either go to the courthouse and purchase a copy. You may be able to view them online there for free too, talk to the local bankruptcy court clerk.
They are also available for purchase online, but you need to register with the provider PACER
They are public once the case is filed.
As a buyer, you can request the debtor to provide you with copies too
Do I need the case# XXXXX PACER, or will the party's name suffice? If so, how do I obtain case #?.
you can search by name, social, case #XXXXX
if it is a common name, it may pull up a long list and be tedious and cost money to search
but it's possible
Seller suggested to me wants to record as gift? are there additional pitfalls or benefits for buyer in that?
makes no difference for the case, same rules would apply as I reviewed.
Talk to your real estate attorney. I would wait until the case is done, discharged, and no asset report filed and request copy to see that the asset was listed, then abandoned by the bankruptcy trustee to make sure you are taking clear, legal title.
I see. If the asset not indicated on case, by no means proceed? If case discharged and asset hidden, then what are my options?
correct, if not listed, then the debtor either: a. is hiding the asset from the court, which opens an ugly can of worms, or b) the asset wasn't the debtors, but perhaps a relatives.
I think you may have answered already, , correct?Case could be reopened.
case reopened to pursue the asset, your sale revoked, etc.
then you have to give back the asset, or buy it again from the trustee, and then sue the bankrupt debtor.
which would be like getting blood out of a rock in most cases!
If I see case has the asset unlisted, does that mean hidden?
either hidden, or not in the debtors name to begin with.
Or is there other legal aspect need to rule out?
if the later, then no issue, but you would need to buy it from the actual owner
debtor listed as trust in deed.
Is that same as trustee?
if listed, you should just wait till the case is over
the trustee is a court appointed lawyer who's job is to liquidate unexempted assets.
Listed as "(debtor's name), a Trust."
so it sounds like the trust might be filing bk?
either way, sounds too fishy to me,and your red flags should make you hold off until discharge.
If debtor listed as a trust on the deed, , is that apart from obligation as debtor?
you can always call the trustee too,
depends on who is actually filing the case.
the individual, or a trust.
a trust usually does not file bankruptcy.
if you have a real estate attorney, they should review all of this first before you give any money.
If indv. filed case, would the asset owned by trust be accountable?
It would depend on the trust, and how it was set up.
the issue is if the asset is listed on the petition.
You need to really do a title search. you
your real estate attorney needs to make sure that you are getting free and clear title without any encumberances.
Tell them about the bankruptcy case. t
They will get all the information from the sellers lawyer and there will need to be title insurance issued.
The title company will want the matter straightened out too before they will insure on it.
What is good way to find when case discharged, monitor case on daily basis?
the cases are normally discharged about 90 days after the case is filed (60 days after the meeting of creditors) if everything goes smoothly. Remember, discharge does not equal end of the case if there are assets to liquidate)
but if discharged, you can call the trustee to confirm everything.
Thank you Terry
Is there anything else I should be aware of or prepare?
that should be it
OK thanks again..will accept and leave +
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