Posted by Rich on May 07, 2002 at 22:08:13:
I’ll call my attorney tomorrow. As part of my BK, I was allowed to keep $12,000 of personal property. I did an inventory of my home and that $12,000 total was met there. I didn’t even look at the restaurant equipment.
Thanks JohnBoy. As always, good advice.
Interesting situation - Posted by Rich
Posted by Rich on May 06, 2002 at 14:26:09:
I recently came out of a Chapter 7 BK. The bank forclosed on all of my properties (other than my home). I just found out that one of the properties didn’t sell at the foreclosure sale. When I had it appraised about 4 years ago, it appraised at $115,000. I had just sold the property next door to it for that same amount. Since then, property values have declined. Also the people I leased the property to are still living in it. For reasons that I don’t know, the bank has allowed them to live there rent free. A friend recently contacted the bank and said they would like to get out from under this property and he felt that it could be purchased for $35k. I’ve read Ed’s posts about buying with bad credit and think I could find a partner to buy it. When buying bank reo’s are there usually strings attached? I’m also hesitant about getting back into real estate.
Any ideas or suggestions are appreciated.
Thanks. - Rich
Re: Interesting situation - Posted by JohnBoy
Posted by JohnBoy on May 06, 2002 at 15:49:46:
Were there any other liens on the property besides the mortgage this lender had on it? If this is the Rich I think it is then if I remember correctly, you had a commercial building that the lender had put a blanket mortgage that encumbered all your properties. But that lien should have been wiped out through the foreclosure. So the only thing against the property would be what this lender had loaned against it. They now own the property so they can sell it for whatever they want. If there were any unpaid property taxes that had a lien against the property then those will remain unless the lender has paid them off. Other than that anyone can buy the property from the bank for any amount the bank agrees to sell it to them for. Of course you would need a partner you can trust to buy this from the bank since I doubt they would sell it to you for that amount.
Re: Interesting situation - Posted by Rich
Posted by Rich on May 07, 2002 at 12:08:02:
Hi Johnboy,
Yes, it’s the same Rich. The property taxes were due during the foreclosure time, and I believe the bank paid them. I doubt that the bank wants to see me, although I still have my home with them. I’d rather not have any dealings with them at all. But until I can reestablish credit, I don’t think any banks are going to refinance my house.
The property in question is a mixed use. I leased a bar/restaurant downstairs and the apartment upstairs to the people that are living there. They stopped operating the bar/restaurant about 6 months ago. I guess they figured as long as they weren’t paying rent, they might as well not work. I’m afraid if they’re evicted, they’ll try to take everything that isn’t nailed down. There’s probably $10k - $15k worth of equipment in there. Is there anything that can be done to prevent them from clearing it out?
Thanks.
Re: Interesting situation - Posted by JohnBoy
Posted by JohnBoy on May 07, 2002 at 12:22:25:
Was the equipment already there when they leased the property? Did they enter into any agreement to purchase the equipment or was that owned by the landlord and just part of the lease? If that is only part of the lease then I would suspect they could be arrested if they were to STEAL property that didn’t belong to them. But if they were buying the equipment then that would be seperate from the leases and they would probably have to be pursued through a civil suit to collect anything if they took off with the equipment. If they were buying the equipment they can argue that it belongs to them. It would have to be settled in a civil suit I’m guessing.
But if it is equipment owned by the landlord and was part of the leased property then they couldn’t just steal the property and could face criminal charges if they took off with it. As a back up get insurance on the property before you start eviction after you purchased it. Then the insurance could cover any damages, unless they are considered the legal owner of the equipment.
Re: Interesting situation - Posted by Rich
Posted by Rich on May 07, 2002 at 18:08:30:
They had a lease with option to purchase the property, from me. The lease option expires in July. However, since I filed BK, I assume the lease is considered null and void.
All of the equipment belonged to me. But I don’t know how I could prove it if they decided to take it. The insurance sounds like a good idea. Buy the property, and once it’s in my partnership’s name, insure all of the contents. If something is lifted then, it would covered.
Re: Interesting situation - Posted by JohnBoy
Posted by JohnBoy on May 07, 2002 at 18:24:52:
If you owed any money on the equipment then it would legally belong to the lender you owed on it to.
If you did not owe anything on it then that would belong to you as personal property. You would need to talk with an attorney on that.
The bank foreclosed and they may or may not be aware of the equipment as to who it really belongs to. They may assume the tenant owns the equipment. They may have told the tenant they didn’t care about it. Who knows.
To be safe so that you would have a legal claim to claim anything missing on your insurance, include the equipment in the purchase agreement from the bank to show you did buy the equipment included with the building. If the bank is unaware that they may own the equipment they will bring it up when they see it listed in the purchase agreement. Hey, that isn’t our equipment to sell. That belongs to the tenants. If that’s the case then contact your lawyer to see if you have legal rights to that equipment. If you owned it then it shouldn’t legally be given to the tenants automatically. If anything the court would have had that sold off to pay towards debt you owed creditors. So you need to look into this and see who is actually entitled to the equipment at this point since that did belong to you as personal property.