A lawyer advises a debtor that he should not list a mortgagee on Schedule D nor the Chapter 7 Individual Debtor's Statement of Intention. The debtor was granted a 100% interest in a home that has a mortgage on it, but the debtor is not personally liable for the mortgage because the mortgage remained in the grantor's name. The reason for the lawyer's advice is that the debtor is not personally liable to the mortgagee and so should not be listed in the petition. However, the debtor insists that the mortgagee be listed. If the lawyer decides to satisfy the debtor and list the mortgagee on Schedule D and the Statement of Intention, how likely is it that a trustee in this situation would demand that the mortgagee be removed (because no personal liability)? What is the usual court fee to amend a Schedule D?
BotXXX XXne is the attorney is correct, if the debt nor asset does not belong to the debtor then it should not be listed. In the last couple of years the court and trustee has seen people listing homes that they have no interest in just to stall a foreclosure for a friend or relative. As to amending a schedule there is no cost from the court, but the attorney might charge a small fee anywhere from $75 to $250, in my practice it depends on if it was client error or not, if the client does not listen or makes me do unnecessary work then I charge for the work. If it an amendment the trustee wants or we are correcting an innocent error then usually no charge.
The debtor has a 100% fee simple interest in the home (does that make a difference?) The debtor wants to list the creditor because he has seen some cases for the same scenario (100% ownership in home and no personal liability for mortgage on the home), but in Chapter 13 cases. After looking at those cases, he feels that his interest in his home is better protected if he lists the mortgagee in his Chapter 7 case.
Is he living in it, or is it bringing in any rental income? who is paying the mortgage?
Not renting it out. He is living in it and paying the mortgage.
Attorney practicing Bankruptcy Law including Chapter 7, Chapter 11, Chapter 12, and Chapter 13.
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