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FiveStarLaw
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Category: Bankruptcy Law
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Experience:  Bankruptcy Lawyer. Experienced.
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We have an 80K note with a gentleman here in Hawaii. He pays

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We have an 80K note with a gentleman here in Hawaii. He pays us 10% interest only monthly. We have this loan secured with a lien on a piece of property and we did have the transaction run through an escrow papers and recorded. He owns this property free and clear.
We have now found out that he is filing bankruptcy. Are we protected to receive our 80K back or the property if he cannot pay when his bankruptcy proceeding are complete? could they require him to sell the property to settle other debts?.
Submitted: 3 years ago.
Category: Bankruptcy Law
Expert:  FiveStarLaw replied 3 years ago.
Welcome to JustAnswer,

So sorry to hear of this dilemma. If my answer is not clear to you, please ask me for clarification by using the reply button.

You will maintain your security interest in the property regardless of the bankruptcy providing the lien was properly secured.

If the borrower fails to make payment on the loan,you will need to obtain bankruptcy court permission in order to foreclose. Typically if you foreclose and the property is sold for less than the lien amount, you will not be able to obtain a deficiency or additional monies from the debtor

You will need to file a proof of claim in the bankruptcy case. Here is the form:
http://www.uscourts.gov/uscourts/RulesAndPolicies/rules/BK_Forms_Official_2010/B_010_0410.pdf


Please use the REPLY button if you have any questions concerning my answer. Otherwise please click ACCEPT so that I am paid by the site for answering.
Customer: replied 3 years ago.
To clarify....no matter, I need to file this form for his bankruptcy case? In other words, even if he is making his interest payments on time at this point, I should file this form. Do I send it to the lawyer or the court?
Customer: replied 3 years ago.
On the forms I received from his lawyer, he has us listed as one of his creditors....number 58 out of 68. Does that suffice the requirement of schedule D?
Expert:  FiveStarLaw replied 3 years ago.
Schedule D. is the correct schedule for secured creditors but I cannot tell you whether he correctly placed all information on that schedule. Regardless, it is best to file your own proof of claim using the form at the link that I gave you. Here is the form link again:
http://www.uscourts.gov/uscourts/RulesAndPolicies/rules/BK_Forms_Official_2010/B_010_0410.pdf

The original is filed with the court in a copy is mailed to the attorney for the debtor. The detailed directions for the proof of claim are on the 2nd page of the link.
Customer: replied 3 years ago.
I can't get that link to work
Customer: replied 3 years ago.
That link just keeps spinning and never brings up that form.
Expert:  FiveStarLaw replied 3 years ago.

The link is working for me -- you can try you can this:
http://www.uscourts.gov/uscourts/RulesAndPolicies/rules/BK_Forms_Official_2010/B_010_0410.pdf

Here is the main link to all the forms:
http://www.uscourts.gov/FormsAndFees/Forms/BankruptcyForms.aspx

Please let me know if you have any difficulties or questions.

Please remember to click accept so that the site pays me for my time
FiveStarLaw, Attorney
Category: Bankruptcy Law
Satisfied Customers: 36633
Experience: Bankruptcy Lawyer. Experienced.
FiveStarLaw and 2 other Bankruptcy Law Specialists are ready to help you

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