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socrateaser
socrateaser, Attorney
Category: Bankruptcy Law
Satisfied Customers: 33914
Experience:  Attorney and Real Estate Broker -- Retired (mostly)
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My sister is filing for a chapter 11 bankruptcy in Pennsylvania.

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My sister is filing for a chapter 11 bankruptcy in Pennsylvania. Her name is XXXXX XXXXX Father's house along with 2 other siblings, so she has 1/4 equity in the house. In reviewing her bankruptcy filing the lawyer has the correct street but the wrong house number for my Father's residence. In addition they have listed her 1/4 ownership in the house as an asset and valued it much higher than what my father's home is worth.

When the bankruptcy papers are filed are there paralegals that work on behalf of the court to verify such information. Is she in danger of having her bankruptcy rejected for these two errors?
Submitted: 1 year ago.
Category: Bankruptcy Law
Expert:  socrateaser replied 1 year ago.
Hello,

The error in the house number is XXXXX minimis, and will not cause a dismissal of the bankruptcy. However, it should be amended, regardless -- because orders concerning the property may be written ineffectively based upon the incorrect address.

The value of her interest in the home, only operates to her disadvantage if it is overstated -- because it suggests that she has greater assets than actually exist. This is a material error, but not one that would cause the bankruptcy to be dismissed, because it only helps the creditors and impairs your sister.

Both errors (and any others) should be corrected by amending the petition. This can be done at any time without consent of the court, but it should be done immediately, or it could cause the case to be delayed and prejudice creditors.

Hope this helps.

Hope this helps.
socrateaser, Attorney
Category: Bankruptcy Law
Satisfied Customers: 33914
Experience: Attorney and Real Estate Broker -- Retired (mostly)
socrateaser and other Bankruptcy Law Specialists are ready to help you
Customer: replied 1 year ago.

I would have thought that having the wrong house number which overestimates her real equity would be a huge mistake. I have told her about the mistake but she says that her lawyer knows what he is doing. Could her secured creditors force a sale of the house to collect payment on debts based on this alleged equity that she has?

Expert:  socrateaser replied 1 year ago.
If the two mistakes are intended to defraud the creditors, for example so as to suggest that your sister owns a different property worth substantially more money, then that could be a big deal.

But, the bankruptcy code permits amendment of the petition at any time prior to plan confirmation -- so, it's not that big a deal, as long as the petition is actually amended.

Also, everything is relative, if we're talking about a huge percentage of the bankruptcy estate's equity being tied up in this one asset, then that would be a bigger deal, than if the equity is a small portion of the estate.

Regardless, a Chapter 11, unlike a Chapter 7 or 13, requires a lot of active attorney management. So, I would be surprised if the petition is not amended sooner, rather than later.

If you are concerned that the attorneys are potentially damaging your sister's future interests, and your sister is rejecting your attempts to help, then all I can say is that I admire your dedication -- but, sometimes, you must allow time for professionals to do their job. If this issue remains unresolved and it appears that the bankruptcy plan is close to confirmation, then I would yank your sister's hair and tell her to get a second opinion -- before it's too late.

Hope this helps.
Customer: replied 1 year ago.


Thank you for your answers. I have enjoyed reading them. They are concise and informative -- you really write well.

Expert:  socrateaser replied 1 year ago.
I'm flattered. Sometimes I write too lawyerly, and I scare people away. Best of luck to you and your sister!

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