Thank you for your question. I am happy to assist you.
Unfortunately that could be the result. The deed would be considered to be a "preference" even though the debt is legitimate and would typically be set aside by the bankruptcy trustee.
Let me explain.
A transfer of the debtor’s assets to a creditor that results in a creditor receiving more than the creditor would have in a Chapter 7 bankruptcy, is typically considered a “preference". A security interest is considered a transfer.
Bankruptcy Code §547 provides for the avoidance of preferential transfers within 90 days before the bankruptcy filing date for third parties. Transfers to insiders (including a relative) are subject to a longer avoidance reach back of one year.
Bankruptcy Code §547 is attached in full:
Section 547. Preferences.
(a) In this section—
Please hit ACCEPT so that I can get credit for my work
Bonuses and Positive Feedback gratefully accepted!
THIS IS FOR INFORMATION ONLY. NO ATTORNEY-CLIENT RELATIONSHIP EXISTS. PLEASE CONSULT A LAWYER IN YOUR STATE FOR LEGAL ADVICE