nova73

Question on Chp. 7

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My house is worth maybe $20,000 because it is rotton and old, in a flood plain. I doubt anyone would even buy it, why I did, I ask myself daily. I still owe more than its worth.

 

But it appraises at $75,000. If I went Chapter 7, and they look to sell the house, how would this work if it never sold at all?

 

Does a trustee come out to look at the house to see if its even marketable?

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Since you owe more than the house is worth, the trustee would not even bother with the house. The bank however will probably foreclose. They will then own the house if it does not sell at auction. They will probably sell if for whatever they can get for it. If you do a CH 7 however, the bank will not be able to come back to you for the difference AND you will not owe taxes.

You can get a real estate agent to give you an honest appraisal that you can give to the BK Trustee. Your BK lawyer can arrange that too.

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If the trustee perceives non-exempt equity worth his or her time, then they will first get their realtor out for a look.  The realtor will report back to the trustee a realistic selling price.  If its truly worth $20k and you owe more, then no worries.   The trustee will leave the case as "no-asset" and put forth the required NDR "No Distribution Report" and then request their duties as trustee be concluded.  If the realtor believes there is non-exempt equity, then the case is marked as an "asset" case and a sale sign will be placed upon your home within a month.  usually the trustee will allow you to occupy the property during the sale process.  If it doesn't sell, then the trustee can switch the case back to "no asset" and follow the earlier-described process.

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Thanks for the replies......I have one more question! I am filing chp7 soon after we get our tax refund. I have been offered a free place to park a mobile home. I have seen several mobile homes around here for around $2000. I was wondering if the trustee will want a run down mobile home and would this be covered under any exemptions since Im relinquishing this house?

 

Again thanks to all here.

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Your state probably has a list of things that would be exempt from the bankruptcy.  Most even have a "wild card" amount, so a $2000 mobile home will likely be okay...but...check with a BK lawyer.

 

AND...a tax refund is probably something the BK trustee would want.  Again, check with a lawyer who is familiar with what the trustees in your area go after.

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