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socrateaser, Attorney
Category: Bankruptcy Law
Satisfied Customers: 38910
Experience:  Attorney and Real Estate Broker -- Retired (mostly)
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Which of the following assets would be exempt from a deficiency

Customer Question

Which of the following assets would be exempt from a deficiency judgment in a foreclosure proceeding: Florida homesteaded property; IRA and 401k retirement funds; deferred compensation; and a QPRT trust for real estate held for my children?
Submitted: 7 years ago.
Category: Bankruptcy Law
Expert:  socrateaser replied 7 years ago.

1. Florida homesteaded property. If homestead property is other than the property in foreclosure, then exempt -- otherwise nonexempt.


2 IRA and 401k retirement funds. Exempt.


3. Deferred Compensation. Unable to ascertain. Wages of a head of household are exempt under Florida law. Deferred compensation could be deemed wages, but I don't know of any case law holding one way or the other. So, potential ground for expensive litigation.


4. QPRT trust for real estate held for my children. If trust property under foreclosure, then nonexempt, otherwise if QPRT is irrevocable, and was not created with the intent to "defraud, hinder or delay" the lender's claim in foreclosure, then exempt. Otherwise nonexempt, unless homestead property not under foreclosure.


Hope this helps.


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socrateaser and 2 other Bankruptcy Law Specialists are ready to help you
Customer: replied 7 years ago.
I have a refinement of the last question I asked you. Are you still online and willing to listen?
Expert:  socrateaser replied 7 years ago.

I'm chained to this computer like Jacob Marley -- or is it Bob Marley...I dunno.

socrateaser and 2 other Bankruptcy Law Specialists are ready to help you
Customer: replied 7 years ago.
I do not see the answer to my second question about building.
Expert:  socrateaser replied 7 years ago.

I thought you were going to post it here. Instead you accepted my comment that I would answer you, and then you posted the question in a different thread.


I will answer over there now...hang on.

Customer: replied 7 years ago.
Where should I go to see your answer?
Expert:  socrateaser replied 7 years ago.

I just posted it. You should get an email shortly.


I'm going to close this thread. Don't respond to this post.

Customer: replied 7 years ago.
I am having difficulty finding the answer to what kind of an attorney I should have to ensure there are no "gotchas", as you point out. Should it be a Massachusetts or Florida attorney, and should it be a bankruptcy attorney?
Expert:  socrateaser replied 7 years ago.

I've been rethinking your situation. Some additional thoughts:


1. If the QPRT was created within the past 4 years, that could be a problem (that's the statute of limitations for a fraudulent transfer).


2. If you take constructive receipt of the trust funds and then move them into the QPRT, that would probably be a fraudulent transfer, because the creditor can argue that you had the property, you knew about the debt, and you moved it to the trust in order to avoid having to pay, without getting "reasonably equivalent value" for your investment.


Anyway, what you want is probably a bankruptcy lawyer, licensed where the QPRT trustee resides, because where the trustee resides, is where the trust exists, even though the real property may be elsewhere.