blacksurfer Posted March 18, 2005 Report Share Posted March 18, 2005 What is sufficient proof for the value of your home when filing a Chp 7?Is the value on the property tax form sufficient or will the trustee want some other type of info like comps from a Real Estate agent? Link to comment Share on other sites More sharing options...
bingo Posted March 18, 2005 Report Share Posted March 18, 2005 Something from a realtor stating a walk away price. Usually a price where the home can be sold within 60 days or so. Remember, you're allowed to deduct commisiions and closing cost from this figure. Link to comment Share on other sites More sharing options...
blacksurfer Posted March 18, 2005 Author Report Share Posted March 18, 2005 The problem for those filing BK, especially in California, is that home prices have risen steadily. I've been reading that a rush is already starting for those filing BK's to beat the new law from going in effect. I wonder how that will affect BK trustees? Link to comment Share on other sites More sharing options...
willingtocope Posted March 18, 2005 Report Share Posted March 18, 2005 It also depends on whether you have equity or not. In our case, we owed more than house was worth so we used property tax valuation. Obviously, if you've got equity, you want the resale value as low as possible, so bingo is right there. Link to comment Share on other sites More sharing options...
blacksurfer Posted March 18, 2005 Author Report Share Posted March 18, 2005 So it is possible to use Property tax evaluation? Our loan is around 115K, the property tax valuation is $145K. Not factoring costs for sale, the equity would be 30K. In Calif spouses get 75K equity exempt. But some homes have been selling for over 200K. So I'm wondering if my recent property tax evaluation of 145K would suffice. Link to comment Share on other sites More sharing options...
willingtocope Posted March 18, 2005 Report Share Posted March 18, 2005 Two suggestions: If you're using an attorney, as his advice...or, if you're doing it pro se, go sit in on a couple of 341 hearings to see how the trustees in your area are dealing with this... Link to comment Share on other sites More sharing options...
blacksurfer Posted March 18, 2005 Author Report Share Posted March 18, 2005 Thanks! I'm just reading up and getting ready. I probably won't file until right before the new bill takes effect. I'm waiting for summons and will fight it tooth and nail. At the last minute I will attempt a meeting of the creditors to settle and if they decline then I will file. Just gaining some knowledge for the inevitable.P.S. I'm fighting the summons Pro Se, but since I have a house to save I will go with an attorney if I file BK. Has anyone get a settlement agreement with their creditors, then take out a loan (2nd mortgage) to pay the settlement? Link to comment Share on other sites More sharing options...
willingtocope Posted March 18, 2005 Report Share Posted March 18, 2005 I think I'd need more info on your last question there. I can tell you from experience that its almost never a good idea to trade secured debt (home equity) for unsecured debt (CC) unless you're absolutely certain that whatever caused the unsecured debt will change. Its just too easy in today's economy for your job to go away and / or your income disappear.With BK, you're unsecured debts vanish (at least until the new law takes effect), and you're still left with your equity.Are you fighting OCs or CAs right now. With an OC summons almost always = judgement, and its difficult to settle. With a CA, summons can be fought...and there's almost never a good reason CR-wise to settle. Link to comment Share on other sites More sharing options...
bingo Posted March 18, 2005 Report Share Posted March 18, 2005 I'd agree with willingtocope. Never place unsecured debt in a secured position. Particularly if all the equity in your home is exempt under your states bk laws. Link to comment Share on other sites More sharing options...
blacksurfer Posted March 18, 2005 Author Report Share Posted March 18, 2005 That might be my dilemma. I "might" have too much equity to qualify for a Chp. 7. I will consult with an attorney first. So if my choice is to pay in Chapter 13 or to pay on a 2nd, then I'm thinking paying on the 2nd to avoid a BK might be the better choice.The summons I'm anticipating is from a debt buyer. But my wife have rec'd a letter from another lawyer for another account who is trying to collect for the OC. Link to comment Share on other sites More sharing options...
blacksurfer Posted March 19, 2005 Author Report Share Posted March 19, 2005 I spoke with a BK lawyer in L.A. Conservatively speaking a liquidation value of a home might go for 20% less than normal sale value. Then you subtract, again conservatively 6% for sale. But sale costs could be 9% when factoring real estate agent commission plus fees.So in my case, my home on the high end could be worth 250K.less 20% liquidation value: $200,000Less 6% sales fees: 188,000Less 75,000 California homestead exemption: 113,000.MY loan on 1st mortgage: $115,000HOUSE IS EXEMPT UNDER CHAPTER 7 !!!!!!!!!!!!! Link to comment Share on other sites More sharing options...
bingo Posted March 19, 2005 Report Share Posted March 19, 2005 --------------------------------------------------------------------------------I spoke with a BK lawyer in L.A. Conservatively speaking a liquidation value of a home might go for 20% less than normal sale value. Thanks for posting this info. We've had a few questions about this lately. In most districts that's the norm. A bk trustee has no interest in holding out for top dollar when unsecured creditors are 3rd in line. Any sales proceeds will go first to the mortgage holder and then, the petitioner must get there exemption and finally unsecured creditors get the crumbs. Hardly worth it when you factor in the expense of a sale plus it may well take over 100 days on the market to fetch anything close to a recent comp. price. Link to comment Share on other sites More sharing options...
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