Best way to buy house from someone in Chap 13 BK? - Posted by DavidGOR

Posted by JohnBoy on August 04, 2004 at 10:56:29:

The BEST way is to get a copy of the approved plan and go see a good BK attorney. Then get together with the seller’s BK attorney and work it out accordingly.

Most likely the trustee will have to approve of the sale. All of the other creditors will have to be notified and they will have the right to object to it or ignore it. If they object a hearing on the matter will take place and the court will decide on the matter. If no other creditors object then the court will likely approve of the sale. This is a process that can take months to resolve. The creditors will have to be notified. They will have a time period allowed to respond. If any respond and object, a hearing date will be set. So it depends on how fast the court is moving. But figure at least 2 - 3 months and possibly longer.

Now the chapter 13 plan may already allow the debtor to sell the property without having to get approval. It depends on what the plan says. But it most cases, the trustee will have to approve of the sale and that could take several months before getting approval.

Get your own attorney that specializes in BK law and get a copy of the seller’s BK plan approved by the court. Then get with the seller’s BK attorney and work things out accordingly.

Best way to buy house from someone in Chap 13 BK? - Posted by DavidGOR

Posted by DavidGOR on August 03, 2004 at 20:12:07:

Is there a “best” way to “buy”/control a house from someone in Chap 13 BK?

Here’s the scenario. I know of a person who has been in Chap 13 BK for 3
years in good standing. His payments to the BK Trustee have always been
on time but his mortgage payment to the bank (which he makes separately)
is always late. He’d like to sell - immediately. The equity is over 50k.

  • Do the creditors and/or Trustee need to approve the fast
    discounted sale of the house? Can I buy an Option to Purchase and put deed in escrow?

  • Can the creditors and/or Trustee reverse the sale if he converts to Chap 7
    a few months and/or years after the sale of his house?

-David G.