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Ask Terry L. Your Own Question
Terry L.
Terry L., Attorney
Category: Bankruptcy Law
Satisfied Customers: 2821
Experience:  Better Business Bureau. 18yrs bankruptcy experience. Chicago Bar Assoc. American Bankruptcy Institute member.
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A friend of mine, DB is filing chapter 7 BK pro se this month.

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A friend of mine, DB is filing chapter 7 BK pro se this month. His home is worth $101,000 on Zillow. He owns it outright, except he is behind on property taxes $20,000 with penalties. Tax collector is scheduled to sell his home in auction next month. He wants to let them sell it at action and collect the proceeds. It will probably sell for around $50,000 as is. It would take at least that much to fix up to sell himself. He is out of work and flat broke. How would he go about filling out his Statement of intention form?
Any other suggestions welcome. Thank you.

Terry L. :

Hi, thanks for your question. You should hire a lawyer for specific legal advice. No attorney client relationship is created here.

Terry L. :

He would mark that he wants to surrender it.

Terry L. :

The bankruptcy trustee can step in and sell it to pay his creditors as well.

Terry L. :

The bankruptcy will discharge the tax debt owing, as long as he lets the house go.

Terry L. :

He can list the tax debt on schedule D, and mark surrender on the statement of intent.

Terry L. :

Then the trustee can decide if it is worth selling to pay the creditors.

Terry L. :

Any questions?

Terry L. :

thanks

Terry L. :

Terry

Customer:

Would he mark 'Claimed as Exempt' or not?

Customer:

That's 'Not claimed as Exempt' on the Statement of Intention

Customer:

Will DB still be entitled to any proceeds after the auction or sale?

Terry L. :

It would be dependant on any exemptions that he may be using. If there is equity after subtracting the exemption and the taxes and any mortgage balance from the value, then he would select 'not claimed as exempt'

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